For each of the following companies, specify whether each company would be more likely to use job costing or process costing. a. Janitorial services company ▼ b. Soup manufacturer ▼ Job costing Process costing c. Commercial plumbing contractor ▼ Job costing Process costing d. Toothpaste manufacturer ▼ Job costing Process costing e. Catering service

Question

03-02-2020
Business

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For each of the following companies, specify whether each company would be more likely to use job costing or process costing. a. Janitorial services company ▼ b. Soup manufacturer ▼ Job costing Process costing c. Commercial plumbing contractor ▼ Job costing Process costing d. Toothpaste manufacturer ▼ Job costing Process costing e. Catering service

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Answer:

A) Janitorial services company: Job costing: janitorial services vary depending on the infrastructure. E.g. It is not the same to do a job for a large office building or for a condo.

B) Soup manufacturer Process costing: the products are the same and they manufactured in a standardized production line.

C) Commercial plumbing contractor: Job costing: a plumber's job changes depending on the infrastructure where he needs to works, it is not standardized. E.g. It is not the same to do a job for a house or for a condo.

D) Toothpaste manufacturer: Process costing: the products are the same and they manufactured in a standardized production line.

E) Catering service: Job costing: catering services vary depending on the customer and the amount of customers that will be served. E.g. it is not the same to cater a child's birthday party or a wedding.