Limitations of job costing


-1

Limitations of job costing

1)      Job costing is comparatively more expensive as more clerical work is involved in identifying each element of cost with specific departments and jobs.

2)      With the increase in the clerical processes, chances of errors are enhanced.

3)      The cost as ascertained, even where they are complied very promptly, are historical as they are compiled after incidence.

4)      The cost compiled under job costing system represents the cost incurred under actual conditions of operation. The system does not have any scientific basis to indicate what the cost should be or should have been, unless standards of performance efficiency are established. Estimated cost, prepared by some concerns in respect of job orders, also do not serve the purpose.

5)      If major economic changes take place, comparison of cost of a job for one period with that of another becomes meaningless. Distortion of cost also occurs when the batch quantities are different.

 


Like it? Share with your friends!

-1
BMS Team

We, at BMS.co.in, believe in sharing knowledge and giving quality information to our BMS students. We are here to provide and update you with every details required by you BMSites! If you want to join us, please mail to [email protected].

49 Comments


Notice: Undefined index: html5 in /home/bmsnewco/public_html/wp-content/plugins/facebook-comments-plugin/class-frontend.php on line 140

Facebook comments:

Choose A Format
Personality quiz
Series of questions that intends to reveal something about the personality
Trivia quiz
Series of questions with right and wrong answers that intends to check knowledge
Poll
Voting to make decisions or determine opinions
Story
Formatted Text with Embeds and Visuals
List
The Classic Internet Listicles
Countdown
The Classic Internet Countdowns
Open List
Submit your own item and vote up for the best submission
Ranked List
Upvote or downvote to decide the best list item
Meme
Upload your own images to make custom memes
Video
Youtube and Vimeo Embeds
Audio
Soundcloud or Mixcloud Embeds
Image
Photo or GIF
Gif
GIF format