A job cost sheet is a complete sheet prepared by the factory accountant for every job started in the factory. It is an important document for accumulating all costs related to a particular job. In a job order costing system, a job cost sheet is maintained for each job. It shows information about the total cost of a particular job. Each job sheet breaks the costs down in terms of direct materials, direct labor, and manufacturing overhead assigned to individual jobs. The following information typically appears in a job cost sheet: John Textiles is a large garment factory based in the United States. The company receives orders and production is undertaken according to customer requirements. For costing purposes, the company's accounts department uses a job order costing system. At the start of November 2018, the company received two orders from Harry Garments. One was for 1,000 t-shirts (14") and the second was for 1,500 trousers (40"). The company's operations department assigned the following job numbers to these orders. The following transactions were recorded during the completion of these two orders: Manufacturing overheads are also given as follows: The lengths of time that machines were used for Job Nos. 303 and 304 were 200 hours and 750 hours, respectively. On 25 November, both jobs were completed and transferred to the storeroom. On 28 November, both orders were shipped to the customer on account at the following prices: Required: The job cost sheet for Job No. 303 is shown as follows: In addition, the job cost sheet for Job No. 304 is given as follows:Job Cost Sheet: Definition and Explanation
Advantages of a Job Cost Sheet
Format of a Job Cost Sheet
Example
Solution
Job Cost Sheet FAQs
A job cost sheet is a document that shows the total cost of a job and its components. It also shows how much it costs to produce a product or service unit.
The following information typically appears in a job cost sheet: - job number - date started - date completed - description - number of units completed - total cost of raw materials - total cost of direct labor - total applied manufacturing overhead - cost summary - shipping summary
The following are the advantages of the job cost sheet: - shows the total cost and cost per unit of the product produced during the given period - helps producers to control production costs - acts as a guide to manufacturers, helping them to formulate a definite and profitable production policy - helps the management to determine product prices - helps the management to compare various elements of cost to previous results and Standard Costs
A job cost sheet shows costs for specific jobs while a Standard Cost sheet outlines the detailed costs of producing a product. The two sheets may also use different time periods to record costs and activity figures.
You should use the job order costing system when you are producing unique products. This method is also ideal for companies that produce custom-made products or high value items, such as cars or computers.
True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.
True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.
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