A comparative study of process and job costing will help in understanding both systems in a better way.
Difference
Process Costing |
Job Costing |
| 1. Costs are calculated process-wise and per unit cost is the average cost ascertained by dividing the total cost of the process by the number of units produced. | 1. Costs are separately calculated for each job, which is a cost unit. |
| 2. Production of standardized and identical products is undertaken. | 2. Production of non-standardized and unidentical items is undertaken in accordance with the instructions and specifications of the customers. |
| 3. Costs are calculated at the end of a particular period. | 3. Costs are ascertained on the completion of a job. |
| 4. As there are series of processes employed, the cost of one process is transferred to the other process. | 4. As the job as a whole is considered as a single unit, there is no of one part of job to another. |
| 5. The nature of production is continuous, there is usually work-in-progress in the beginning as well as at the end. |
5. The work-in-progress may or may not occur in the beginning and at the end of the accounting period. |
| 6. On account of continuous and un-interrupted production, cost control is comparatively easier. | 6. Cost control becomes difficult due to the intermittent nature of production. |
| 7. Production is taken to stores. | 7. Production is undertaken against orders from the customers. |