# Ch 4: Job-Order Costing & Process Costing

Work through this chapter and discover how job-order costing and process costing help businesses determine per-unit costs for higher returns. The lessons set off keywords in bold letters, making memorization of the materials easier.

## Job-Order Costing & Process Costing - Chapter Summary and Learning Objectives

If an organization prints books on-demand, for example, its cost per job will change based on the size of each job. Organizations need to make money no matter the size of the jobs they run, so they perform job-order costing and process costing calculations to help them determine what they should charge consumers. In this chapter, the instructors have developed several lessons to teach you the finer points about determining the cost of jobs and orders. After finishing this chapter, you should have a deeper comprehension of the following:

• How to review income and inventory statements to determine costs
• The various types of costs and how they affect costing systems
• The uses and relationships between different costing methods
• Figuring out cash flows and the flow of costs

Lesson Objective
Absorption Costing: Income Statement & Marginal Costing Point out the differences between marginal costing and absorption costing, and show the relationship between income statement preparation and absorption costing.
Job-Order Costing System Processes Define and show the connection between the following: direct labor costs, calculating direct material costs, job sheet calculations of per-unit costs, predetermined overhead rate within an allocation base, and manufacturing overhead (MOH).
Flow of Costs without Journal Entries Explain how to measure the flow of costs in scenarios where journal entries are not present.
Cost Classifications on Goods & Inventory Statements Describe the following: schedule of cost of goods manufactured, inventory accounts listed on the balance sheet, and the cost of goods sold noted on the income statement.
Inventory Cost: Definition, Methods & Types Analyze ownership of inventory, review the three different types of inventory costs, describe the cost of goods sold, and explain the ending inventory.
Issues of Overhead Application without Journal Entries Interpret the issues of under-applied and oversupplied overhead, and determine how a disposition of overhead to inventory may affect the cost of goods sold.
Job-Order Costing in a Service Company Define a service company and identify how job-order costing can impact the flow of goods.
Comparing Job-Order & Process Costing Describe each costing methodology and point out how they differ from each other.
Cash Flows in Process Costing without Journal Entries Extrapolate how processing departments would figure out process costing and cost accumulation if they do not have access to journal entries.
The Weighted-Average Method of Equivalent Units of Production Apply this methodology to make calculations for the cost of per equivalent unit, conversion, and materials; take those calculations to analyze which goods have been transferred out of the inventory; and, show how to include this method as you run cost reconciliation reports.

10 Lessons in Chapter 4: Job-Order Costing & Process Costing
Test your knowledge with a 30-question chapter practice test
Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
Not Taken
Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
Not Taken

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