Hello,
I was given "The Boeing Company" for a Cost Accounting project and
in theory, we learn that...

Question

Hello,
I was given "The Boeing Company" for a Cost Accounting project and 
in theory, we learn that such a company employs the Job Costing System.
However, according to this [1]article,Boeing uses the Process Costing System in practice.
The rationale being to improve the firm’s ability to manage costs by 
linking the costs to processes where there was management responsibility
 rather than to overhead pools used only in product costing. Under the 
prior job costing system, much of total manufacturing cost was buried in
 overhead pools so it is impossible to identify the costs of benefits of
 systems changes, or the effect of new technologies. The objective of 
the new process costing system was to provide better information on 
costs by linking them to production processes rather than to overhead 
cost pools.
Hence, my question is which cost accounting system is easier to justify, Process or Job.
Thanks in advance!
Cheers!

Robert · Accepted Answer

Solution 
 
"The Boeing Company" is a company, which manufacture the Aircrafts as per the 
specifications of the customers. This company does not manufacture the aircrafts 
in bulk and keep in the inventory. Manufacturing process starts, when the 
confirmed order is received from the customer with complete specifications of 
the aircraft required.

Hello, I was given "The Boeing Company" for a Cost Accounting project and in theory, we learn that such a company employs the Job Costing System. However, according to this [1]article,Boeing uses the...

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