Job order costing is a system for allocating costs to groups of unique products made to customer specifications. House constuction often relies on job order costing because they are each different.
Process costing is a system for allocating costs to homogeneous units of a massproduced product. Method would be used in producing running shoes that are all basically the same.
- Activity-based costing (ABC) is a cost system that focuses on activities, determines their costs, and then uses appropriate cost drivers to trace costs to the products based on the activities. It is most
- commonly used when overhead is a significant part of an item's cost because various types of
- overhead are driven by different things.
