What is the difference between job costing and traditional costing? Is it that job costing allocates manufacturing overhead while traditional costing does not?

Comparison between job costing and traditional costing:

(1) Difference in overhead boundaries.

Under the traditional costing method, overhead refers to the manufacturing cost, which, in terms of economic content, includes only the costs directly and indirectly related to the production of products, and the expenses for managing and organizing the production of the whole factory, selling the products, and raising the funds for the production of the expenses as the period costs. Under the job costing method, the product cost is the full cost, and all expenses should be included in the production cost as long as they are reasonable and effective and beneficial to the final enterprise value. It emphasizes the reasonableness and validity of expenses, regardless of whether they are directly or indirectly related to production. In this case, the period costs are all the unreasonable and ineffective expenditures.

(2) the difference in the accuracy of information.

The main purpose of the traditional cost method of calculating costs is to the auxiliary departments of the manufacturing costs collected in a kind of average linear way of distribution to the products, without considering the actual production of products consumed with the cost of the proportion of the problem, can only be a kind of "absolute inaccuracy" (absolute

Inaccu2racy). The cost of products calculated by the job costing method is the same as the cost of the product. Job costing method of product cost information can be regarded as a relative

accuracy) information. The job costing method allocates overhead costs by focusing on the source of the costs and expenses and linking the allocation of overhead costs to the causes of those costs. In allocating overhead costs, diversified allocation criteria (cost drivers) are chosen, making the attributability of costs much higher and minimizing the proportion of overhead costs allocated according to artificial criteria, thus improving the accuracy of cost information. If the cost of a product is regarded as a bull's-eye, the job costing method cannot hit the bull's-eye every time, but it can consistently hit the outer and middle rings of the target.

(3) The difference between production management and quality management.

The traditional cost method under the management of the production system is a kind of production system from the front to push back. That is, the production of raw materials from the beginning of the first production process, the first process after the completion of semi-finished products into the second production process, and so on, step by step, until the final formation of the finished product, and thus the traditional cost and quality management generally focuses on the quality of semi-finished products and finished product quality inspection, problems, timely repair or elimination.

The production management system under the job costing method is generally a just-in-time production system, which is different from the traditional production, it is a kind of backward push-like production system from back to front, the enterprise's production program is interlocked, very close connection, improve the efficiency and profitability of the work, but also make the enterprise to reduce the cost of inventory. The quality management under the job cost method is from the "cradle to grave" of Total Quality Control (

Total QualityControl, referred to as TQC), which requires that workers in each production chain put their own production gate, realize self-quality supervision, and immediately correct the defects in the production process when they find the defects. Corrections.

(4) Differences in the characteristics of the distribution basis.

The traditional cost method mainly adopts a single financial variable, such as labor hours, as the allocation basis, and ignores a good set of non-financial variables, thus losing some favorable opportunities to improve the company's management. The allocation basis of the job costing method is diversified, emphasizing not only financial variables such as labor hours, machine hours, production lot size, and the number of parts and components in a product, but also non-financial variables such as process change instructions, the number of adjustments to be made, and the distance to be transported. Adopting multiple allocation bases improves the correlation between products and their actual consumption costs, and enables management to go deeper into the operation level to eliminate "non-value-added operations", improve "value-added operations", and increase "customer value". "

Advancement of the value of the work

(5) Differences in application conditions.

Traditional cost method is applicable to the product structure of a single, relatively small amount of manufacturing costs, and its occurrence and direct labor costs are in fact related to the labor-intensive enterprises. The job costing method is generally applicable to a large proportion of overhead costs, a wide variety of products, product production processes are complex and varied, production and business activities are very complex, better implementation of just-in-time production system and total quality management system, management is not satisfied with the accuracy of the information provided by the traditional costing system of the technology- and capital-intensive enterprises.

Is it the case that job costing allocates manufacturing overhead while traditional costing does not?

No, it is not.

Calculation procedure of job costing method compared with traditional method of allocating manufacturing overhead

I. The calculation procedure of job costing method is carried out in two stages.

In the first stage, the job consumes resources.

That is, the value contained in the resource is allocated to each job cost pool according to the needs of the job (Ac tiv ity C o stP 0 0 1);

The second stage, the costing object (product) consumes the job. Since the output requires jobs, the cost of each job cost pool is allocated to the costing object.

Its costing procedure is: pooling, allocation and reallocation.

Therefore, the initial establishment of the job costing system, we should pay attention to the selection of fewer types of work, but more typical of the work, generally take 20 to 30 kinds of appropriate. The main method to realize the requirements of fewer types of typical operations is homogeneous merger. That is, the merger of homogeneous operations to form a homogeneous cost pool.

Two, the traditional manufacturing cost allocation method of calculation procedures is at the end of the period, based on a variety of vouchers and a variety of cost allocation tables, such as: material costs, purchased power costs, salary costs, depreciation, auxiliary production plant costs and other allocation tables, the total registration of the collection. Afterwards, one or several allocation criteria with **** are selected to allocate the manufacturing costs to the product cost. If only one product is produced in the current period, all the manufacturing costs will be charged to that product, which means that they will be collected directly without allocation.

The calculation procedure of the traditional method of allocating manufacturing costs can be summarized in two steps, namely, the collection and allocation.

Reasonable manufacturing cost allocation criteria should be determined to meet the allocation criteria have "**** have" principle i (the object should bear the manufacturing costs should have the allocation criteria information) should be able to reflect the "proportionality" principle; ((the allocation criteria and manufacturing costs between the objective and the existence of the information). (There is an objective relationship of causality and proportionality between the allocation criteria and the manufacturing costs. (There is an objective causal relationship between the allocation criteria and the manufacturing costs.) The information should be "measurable" in the sense that it is easy to obtain; it should be relatively "stable", etc. Job costing method adopts the typical "cost-driven factor" as the allocation criteria is a major change and breakthrough to the traditional manufacturing cost allocation method. The job costing method uses cost drivers as the intermediary connecting resources and products, and the cost collection and allocation need to calculate the resource cost consumed by the job first, and then calculate the job cost consumed by the product. In addition to the product is the final costing object, as an intermediary "job" has become a new costing object, and become a link between resources and products. The two-stage approach of "job consumes resources" and "product consumes job" in terms of the collection step and the selection of cost drivers as the allocation criteria, changing the traditional costing method of "unification" and "simplicity". " and "simplistic" program.