Which company should use a job ordering costing system?

A job ordering costing system is most suitable for businesses that produce unique or customized products, which require tracking costs for each specific job or order. In the case of a manufacturer of custom furniture, each piece of furniture is typically made to individual specifications, and costs can vary significantly from one job to another based on the materials used, labor involved, and specific customer requirements.

In this scenario, the company needs to allocate costs accurately to each unique piece or job to determine profitability and ensure proper pricing. This method allows for detailed tracking of expenses related to each custom project, providing insights for pricing decisions and cost control.

Other companies in the options listed typically produce standardized products. For example, manufacturers of paint and food processing plants work with mass production processes where costs are averaged across large volumes of identical products, making a job order costing system less applicable. A loan processing firm, while it may have unique service aspects, typically relies more on standard costs or time-based billing rather than tracking costs associated with specific jobs.