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Management accounting 2022

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Question:

What are the 6 steps in a job costing system?

Author: Hjalmer Pedersen



Answer:

1. Identify the chosen cost object 2. Identify the direct costs of the job 3. Identify the indirect costs associated with each cost-allocation base 4. Select the costs-allocation base 5. Compute the rate per unit of each cost-allocation base used to allocate indirect costs to the job (Actual costing vs normal costing) 6. Compute the cost of the job adding all direct and indirect costs assigned to it


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