1. Consider the activities undertaken by a medical clinic in your area.
a. Do you consider a job order cost accounting system appropriate for the clinic?
b. Identify as many factors as possible to lead you to conclude that it uses a job order system.
2. Refer to the chapter opener regarding John Hewitt and his company, Liberty Tax Service. All successful businesses track their costs, and it is especially important for start-up businesses to monitor and control costs.
a. Assume that Liberty Tax Service uses a job order costing system. For the basic cost category of direct materials, explain how a job cost sheet for Liberty Tax Service would differ from a job cost sheet for a manufacturing company.
b. For the basic cost categories of direct labor and overhead, provide examples of the types of costs that would fall into each category for Liberty Tax Service.