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What are the primary documents used in a job order costing system?

A job can be categorized by the stage of its production cycle. There are three stages of production: 
 
(1) contracted for but not yet started, 
(2) in process, and 
(3) completed.

Because a company using job order costing is making products according to user specifications, jobs might occasionally require unique raw material. Thus, some raw material may not be acquired until a job is under contract and it is known that production will occur. The raw material acquired, although often separately distinguishable and related to specific jobs, is accounted for in a single general ledger control account (Raw Material Inventory) with subsidiary ledger backup.

The material may, however, be designated in the storeroom and possibly in the subsidiary records as being “held for use in Job XX.” Such designations should keep the material from being used on a job other than the one for which it was acquired.

In concept, there could be four categories. The third and fourth categories would distinguish between products completed but not sold and products completed and sold. However, the usual case is that firms using a job order costing system produce only products for which there is a current demand. Consequently, there is usually no inventory of finished products that await sale.