Various Mehtods of Costing. Different industries follow different methods for ascertaining cost of their pro ducts.

The method to be adopted by business organisation will depend on the natu re of the production and the type of out put. The following are the important methods of costing. Job Costing: Job costing is concerned with the finding of the cost of each job o r work order. This method is followed by these concerns when work is carried on by the customers request, such as printer general engineering work shop etc. und er this system a job cost sheet is required to be prepared find out profit or lo sses for each job or work order. Contract Costing: Contract costing is applied for contract work like constructi on of dam building civil engineering contract etc. each contract or job is treat ed as separate cost unit for the cost ascertainment and control. Batch Costing: A batch is a group of identical products. Under batch costing a b atch of similar products is treated as a separate unit for the purpose of ascert aining cost. The total costs of a batch is divided by the total number of units in a batch to arrive at the costs per unit. This type of costing is generally us ed in industries like bakery, toy manufacturing etc. Process Costing: This method is used in industries where production is carried o n through different stages or processes before becoming a finished product. Cost s are determined separately for each process. The main feature of process costin g is that output of one process becomes the raw materials of another process unt il final product is obtained. This type of costing is generally used in industri es like textile, chemical paper, oil refining etc. Service (Operating) Costing: This method is used in those industries which rende red services instead of producing goods. Under this method cost of providing a s ervice is also determined. It is also called service costing. The organisation l ike water supply department, electricity department etc. are the examples of usi ng operating costing. Operation Costing: This is suitable for industries where production is continuou s and units are exactly identical to each other. This method is applied in indus tries like mines or drilling, cement works etc. Under this system cost sheet is prepared to find out cost per unit and profits or loss on production. Multiple Costing: It means combination of two or more of the above methods of co sting. Where a product comprises many assembled parts or components (as in case of motor car) costs have to be ascertained for each component as well as for the finished product for different components, different methods of costing may be used. It is also known as composite costing. This type of costing is applicable to industries producing motor vehicle, aeroplane radio, T.V. etc.