Job Costing Assignment
Course Code: ACT 345
Section: D1
Done by: Shurooq Al Darmaki
ID Number: 20155932
4-5)
The service industry in hospitals, law firms and accounting firms use job order costing because
they all tend to manufacture and provide different services that take different cost and amount of
labor so all of the following requires tracing or allocating to each job and maintaining cost
records for each and they are usually small. In contrast, process costing is used for large
companies the produce huge amount of similar products which don’t work in companies such as
service industry in hospitals, law firms and accounting firms.Therefore, they use the job order
costing system.
4-11)
To start with, Overhead applied is referred when the applied factory overhead is greater than
actual factory overhead.Whereas, Underapplied overhead is referred to when the actual factory
overhead is greater than the applied factory overhead.
At the end of the year factory overhead must be closed because it’s a temporary account. So it
will be recorded as:
When it’s overapplied
Dr Cr