1.The main differences between a job-order and a process-costing system.

These are some of the differences between job-order costing and process costing based on the
following criteria:
A. Nature of products and services
Job-order costing is used for unique, customized, or heterogeneous products and services.
Each job or order is distinct from the others and may require different resources and product
processes. Process costing is suitable for homogenous, standardized, or related products or
services. The units produced are identical, and the production process is continuous and
repetitive.
B. Cost measurement
In job-order costing, the cost of each job can be easily determined as the direct costs (materials
and labor) and the overhead costs are directly attributable to that specific job.
In process costing, the cost per unit is calculated by dividing the total cost of a process or
department by the number of units produced during the period. The individual cost of each unit
is not readily available as it is an average cost.
C. Cost accumulation
In job-order costing, the costs accumulate for individual jobs, projects, or orders. Each job has
its own unique set of direct materials, direct labor, and overhead costs.
In process costing, costs accumulate by processes or departments. Costs are also collected
over a specific period and are averaged across all units produced during the period.
D. Use of cost sheets
In job-order costing, it typically uses cost sheets for each job or order, where all the direct and
indirect costs associated with that particular job are recorded.
In process costing, it utilizes cost sheets for each process or department, showing the costs
incurred and the number of units produced in that specific period.
E. Cost control
Job order costing allows for better cost control as costs can be easily tracked for each individual
job, while process costing provides average costs for each unit produced, making it easier to
predict and control costs in continuous mass production.
In essence, the choice between job-order costing and process costing depends on the nature of
the products or services, the production process, and the company’s specific cost allocation
needs. Both costing systems serve their purpose effectively in their respective industries.
2. Your company's adopted costing system and the reasons behind it.
In the healthcare industry, a cost accounting system is a very critical component of hospitals’
cost-control efforts because it is practical and generally accurate. Medical services providers,
such as hospitals, small doctor’s offices, and medical billing companies, apply mainly job-order
costing to consider each patient or bill as a single entity and also in the context where each
patient is a unique case. In most hospitals specifically, the goal of costing is to determine the
cost of providing medical services, where different departments are frequently formed based on
the tasks they perform.
There are many reasons why a medical health care organization would choose to use a job-
costing system, but one most important reason is to track the costs associated with specific
patients or groups of patients. This information can be used to determine the cost-effectiveness
of different treatments or interventions, to track the costs of specific medical procedures, to track
the costs of specific medical equipment, and specific types of medical supplies.
All these sets of relevant data can be used to negotiate reimbursement rates with health
insurance companies and health maintenance organizations, as well as to update fees or cost
structures for those directly paying patients.