Your CFO, in her initial work, needs to decide whether to set up a job order costing system or a process type costing system. She has asked you to make a recommendation based on the following information. You plan to meet with her in the morning. Write a paper in response to the following, and provide support for your recommendation:
Compare and contrast job order costing to process costing methods.
What kind of system works best in what kinds of companies?
What kind of system makes sense for your company, given that you plan to start with only one version of your product but at some point in the future may offer a variety of options?
Compare and contrast job order costing to process costing methods:
In job order costing, different type of jobs or orders with different production requirements are being handled in each period whereas process costing is concerned with an identical product being produced on a continuous basis. In the case of job order costing, costs are accumulated ...
Compare and contrast job order costing systems with process type costing systems: What is best for what kinds of companies?