Job Costing for Specific Custom Orders

Steps:

• Identify the scenario: preparing a quotation for a unique batch of 100 leaflets, a one-off customer order.
• Note costs included: direct materials, direct labor, and allocated overheads totaling $20, representing full job expenses.
• Observe profit calculation: 25% added on total cost, typical for quoting individual jobs.
• Match to definition: this tracks and accumulates all costs for a specific job, defining job costing.

Why B is correct:

• Job costing accumulates direct materials, labor, and overheads for individual custom jobs or batches, as in this printing quotation.

Why the others are wrong:

• A: Absorption costing includes fixed overheads in unit costs but applies broadly, not specifically to tracking unique jobs.
• C: Marginal costing uses only variable costs, ignoring overheads, unlike the inclusion of a share of overheads here.
• D: Unit costing calculates average costs for continuous, identical mass production, not discrete custom orders like leaflets.

Final answer: B