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14 February, 15:17

Identify each of the following types of businesses as either job-order or process costing. a. Hospital services b. Custom cabinet making c. Toy manufacturing d. Soft-drink bottling e. Airplane manufacturing (e. g., 767s) f. Personal computer assembly g. Furniture making (e. g., computer desks sold at discount stores) h. Custom furniture making i. Dental services j. Paper manufacturing k. Nut and bolt manufacturing l. Auto repair m. Architectural services n. Landscape design services o. Flashlight manufacturing

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  1. 14 February, 15:49
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    The answer to the question above is given below:

    Explanation:

    First, for a better understanding of the type of business to be categorized as job-order or process costing, explanation would be made on what job-order and process costing are.

    Job-order costing is used when items produced differ such that each carries a significant cost. Job-order costing systems track costs by job and are used by companies to calculate costs of unique products been produced.

    Process costing assigns product costs to departments and is used by companies that produce similar products this ensures a continuous style of production employed. No difference in the products been produced in process costing.

    Going by the definition above one can categorize the businesses:

    a. Hospital services are a Job-order costing type of business

    b. Custom cabinet making is a Job-order costing type of business

    c. Toy manufacturing is a Process costing type of business

    d. Soft-drink bottling is a Process costing type of business

    e. Airplane manufacturing (e. g., 767s) is a Process costing type of business because they produce similar products (767s) that translate to a consistent process. But if the model of the airplane is not specified then it is a Job-order costing type of business.

    f. Personal computer assembly is a Job-order costing type of business

    g. Furniture making (e. g., computer desks sold at discount stores)

    h. Custom furniture making is a Job-order costing type of business

    i. Dental services are a Job-order costing type of business

    j. Paper manufacturing is a Process costing type of business

    k. Nut and bolt manufacturing is a Process costing type of business

    l. Auto repair is a Job-order costing type of business

    m. Architectural services are a Job-order costing type of business

    n. Landscape design services are a Job-order costing type of business

    o. Flashlight manufacturing is a Process costing type of business
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