Question

State one advantage of job costing.

Hint:

Job costing = Cost and profit for each job clearly identified.

Answer 1

Job costing is a costing method used when work is undertaken according to specific customer orders.
Each job is treated as a separate unit of cost, and all costs are traced and allocated to that specific job.
One major advantage is that it helps the business know the exact cost and profit or loss for each job completed.
This information helps in quoting accurate prices for future jobs and in effective cost control.
Therefore, job costing provides clear cost information for individual customer orders.