WS

1. NAME: DHEERAJ AGRAWAL NAME: DEVANGI DHINGANI
DIV.: C DIV.: C
ROLL NO.: 11 ROLL NO.: 12
ENROLL NO.: 147110592023 ENROLL NO.: 147110592024
SUBJECT
COST & MANAGEMENT ACCOUNTING
PARUL INSTITUTE OF MANAGEMENT &
RESEARCH

2. 1. Job Order costing.
2. Contract/Terminal costing.
3. Batch Costing.
4. Process Costing.
5. Operating Costing.
6. Single/output/unit costing.
7. Operating/Service costing.
8. Multiple or Composite costing.

3.  Job costing is also known as job order costing.
 It is that form of specific order costing which applies where
the work is undertaken as per the customer’s specific
requirements and each order is of comparatively short
duration.
 E.g. Consulting and legal firms, Architects, Manufacturers of
ships and airplanes, Book publishers, Movie producers,
jewellers.

4.  The Terminology of CIMA defines batch cost as ‘aggregated
costs relative to a cost unit which consists of a group of similar
articles which maintains its identity throughout one or more
stages of production.’
 In batch costing, the cost unit is not a single product but some
specific quantity of similar products at the same time.
 E.g. Pharmaceutical Companies, Readymade Garments, Electrical
Tools And Machinery Spare Parts, Brick Producer, Milk Pouch,
wafer manufacturer.

5. JOB COSTING BATCH COSTING
 Each job work is undertaken to
customers’ special requirements.
 The time taken for execution of each
job is of short duration.
 Each job is treated as a cost unit
which consists of a single order or a
contract.
 Each job has a distinct number and
costs are collected against the same
number.
 It applies where similar article are
manufactured in batches for sale or
for use within undertakings.
 The process time for each article in a
batch is less than generally taken for
execution of a job.
 A batch is a group of similar product
and it is treated as a single cost unit.
 Each batch has a distinct number and
costs relating to the batch of units
accumulated.

6. JOB COSTING BATCH COSTING
 Each job is separate & independent of
other job.
 Cost are computed when job is
completed.
 Jobs are different so cost of
supervision is more.
 Product lose their individual identity
as they are manufactured in
continuous flow.
 Cost are calculated at the end of cost
period.
 Process of production is equal so it
require less supervision.

7. 1. Identify Job.
2. Production order.
3. Material costs.
4. Labour costs.
5. Manufacturing & other overheads.
6. Compute Total Costs.
7. Completion of job.

8. i) Identify Job:
The first step in the job-costing process is to
identify the scope of the project or job. To accurately
perform a job costing, it is important to know everything the
job entails. E.g. A carpenter receive an order to make a 100
benches for a tution class.
ii) Production order:
On receipt of an order from the customer for
manufacturing a certain product the production planning
department prepare a suitable design & drawings of the job
as per the specification. The department also prepares an
estimate of the materials required for the product in the form
of bills of payment.

9. A production order is issued to the workshop to
proceed with the job. A production order contains all the
information that is relevant to the job. It consist of the
following information:
a) Particulars of the job.
b) Quantity to be produced.
c) Date of starting of the job.
d) Required date of completion of job.
e) Particulars of the materials require.
f) Particulars of various operations involved in the performance
& execution of the job.
Each production order is assigned a number called
job order number or production order number or work order
number.

10.  Copies of production order are sent to:
◦ A) The stores for issue of materials
◦ B) The department concerned to undertake production, and
◦ C) The cost dept. For determining cost of the job.

11. SERIAL NO._____
PRODUCTION ORDER NO & DATE______
CUSTOMER REF NO.: _____
PARTICULARS OF JOB _____
DEPARTMENTS_____
BILLS OF MATERIAL NO_____
DESCRIPTION NO:______
DATE STARTED______
QUANTITY OF ORDER______
OPERATION SCHEDULE NO______
TOOLS LIST NO:_________
SPECIAL INSTRUCTIONS:
MATERIALS
PARTICULARS CODE NO. QUANTITY PARTICULARS CODE NO. QUANTITY
WOODEN 114 150 kg
NAILS 123 500 nos.
LABOUR
SR.
NO
NAME HOURS TIME
START
TIME
END
SR.
NO
NAME HOURS TIME
START
TIME
END
1 ABC 8 12 20
ORDERED BY:_______
CHECKED BY:_______
APPROVED BY:_____
PERFORMA OF PRODUCTION ORDER

12. iii) Material costs:
The cost of material are recorded in the job order
card. Any indirect materials required can also be drawn by
material requisitions & their cost are recorded in job order
card. Generally the cost of materials issued is ascertained
through a material issue analysis sheet.
iv) Labour costs:
on the basis of the time sheets or piece work cards
the labour costs are ascertained & classified into direct &
indirect wages. They are subsequently analysed in the wage
analysis sheet and included in the job order card.

13. v) Manufacturing & other Overheads:
Overheads may be predetermined or actual. They
are worked out for each cost. Overheads cost of each job is
summarised in an overhead absorption analysis sheet &
there from the overheads relating to the job are analysed and
entered in the job costs sheet as factory overhead,
administration o/h, and selling & distribution o/h.
vi) Compute Total Costs.
The final step in the job costing process is to add
the direct costs to the indirect costs that have been
calculated. The final figure is the estimated cost for the total
project. Compare this figure with the figure quoted to the
customer to complete the job. The difference between the
two figures identifies either the profit or the loss for
completion of the project.

14. vii) Completion of job:
On completion of the job a job completion report
is sent by the shop to the production planning dept. and a copy
of the same is sent to the cost dept. this report indicates that
the jobs are completed & the cost sheet may be closed. The
total cost is divided by the number of jobs executed or units
manufactured to determined the cost per job or unit.

15. So job order costing method is easy to calculate &
also provides the controll on costs which are unnecessary for
the job. But the cost sheet which can be use in this method is
vary by job or contract.