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314) Job costing not commonly used by service firms (such

Question : 314) Job costing not commonly used by service firms (such : 1876937

314) Job costing is not commonly used by service firms (such as law firms) or trades people (such as auto mechanics).

315) Service firms follow the same approach for indirect costs as manufacturing companies because they develop a predetermined indirect cost allocation rate.

316) A service firm's costs are comprised of direct materials, direct labor and manufacturing overhead.

317) A labor time record is an essential component of accounting in a service firm.

318) Since a service firm does not carry a large amount of inventory, it is not necessary to know the individual costs related to each individual job.

319) The most significant cost for a service firm is direct labor cost.

320) The main driver of indirect costs for service firms is usually labor hours.

321) When job costing is used at a service company, direct costs of serving the client are traced to the job, whereas the indirect costs of serving the client are allocated to the job.

322) At a service company, the indirect costs of serving the client consists of operating expenses.

323) At a service company, the indirect costs of serving the client include manufacturing overhead.

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