Which of the following is a primary use of job cost sheets in accounting?

• A. Prepare the company's income tax return
• B. Track the costs assigned to specific jobs or projects
• C. Calculate depreciation expense for fixed assets
• D. Record cash receipts from customers

Answer: (B)

Verified step by step guidance

1. Understand the concept of a job cost sheet: A job cost sheet is a document used in job order costing systems to track the costs associated with a specific job or project. It typically includes direct materials, direct labor, and applied overhead costs.
2. Identify the primary purpose of job cost sheets: The main use of job cost sheets is to monitor and record the costs assigned to individual jobs or projects, ensuring accurate cost tracking and allocation.
3. Eliminate unrelated options: Preparing the company's income tax return, calculating depreciation expense for fixed assets, and recording cash receipts from customers are not functions of job cost sheets. These tasks are handled by other accounting tools and processes.
4. Focus on the correct option: The correct answer is 'Track the costs assigned to specific jobs or projects,' as this aligns with the primary purpose of job cost sheets in accounting.
5. Summarize the importance: Job cost sheets are essential for businesses using job order costing systems, as they provide detailed cost information for decision-making, pricing, and profitability analysis.