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Anonymous Staff Accountant

Job Costing Question

Asked on Jan. 15, 2015

My company just switched to a new accounting system that is designed centered on job costing. As a result, every expense needs to have a job number. I have an expense that is related to all the jobs for one of the regions. What is the best way to allocate this expense to all the jobs? I have some ideas below. 1) Allocate the expense to all the jobs for that region, however, the expense is relatively small. If doing so for this one, we have to be consistent and do it for all expenses like this. It will be time consuming for AP. 2) Budget the expense to the biggest job within that region, that way there will be no allocation needed. Can someone give me some ideas?

Answers

EMERSON GALFO CFO • January 14, 2015

If the expense is really applicable to specific subsets, then you should allocate it to the specific subset. You should allocate expenses like it consistently.

" It will be time consuming for AP." ..... NOT if you have template entries. I am pretty sure your system will have that feature.

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