What is job costing?

In accounting, job costing is tracking the costs and revenues by position in a business. This allows for a standardized report of profitability for each position at a company. The costs associated with job costing are any materials, labor, and overhead for a specific job.

There are many purposes for job costing. Firstly, and most commonly, you can use it to track specific costs associated with different roles, which can help you see how costs can be reduced for later jobs. You can also use it to see if any costs can be billed to the customer rather than paid by the company.