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SSC Financial and Cost Accounting P-1 QUESTION #1204
Question 1
Which costing method is most suitable for industries where products are unique and produced to customer specifications?
  • Process costing
  • Activity-based costing
  • Job order costing✔️
  • Marginal costing
Correct Answer Explanation
Job order costing is used when products are distinct, customized, and produced according to specific customer orders (e.g., custom furniture, construction projects, legal cases). Costs (materials, labor, overhead) are tracked separately for each job or order. Process costing, by contrast, is used for mass production of homogeneous products.