 When we produce inventory, when we are a manufacturing company, we typically will be using either a job cost system or a process cost system. And the difference between these two, which one will we use, will typically depend on the type of inventory that we produce. So let's go through the characteristics that will generally be apparent or be present when we use a job cost system. And when we look at these, we want to compare and contrast the two. When would we use a job cost system? When would we use a process cost system? As we start to work through a problems of a job cost system and process cost system, we'll start to see why these characteristics of inventory are going to be those that will distinguish whether we choose to be a job cost system or a process cost system. For now, just note that a job cost system means that we're going to apply the cost of the inventory to particular jobs. So we're going to have a particular job, we're going to assign the costs to that job, as opposed to a process cost system, where we're going to assign costs to a process as we go. So as we think of this, we're going to think of the example of custom guitars, pretty much anything custom that you can think of, you can that's one type of thing that would basically usually be in a job cost system. So if we get an order for a guitar, it's going to be a specific type of guitar, and we're going to custom make this guitar in accordance with the order, we would typically use more of a job cost system. It's also something that if you think of custom for like construction and stuff like that, construction jobs are typically going to be different in nature. And therefore we typically use a job cost system. So that's the first characteristic we'll have if it's a custom order, then we're typically going to use a job cost system. Now I would use that characteristic in order to then think about the other characteristics as following from it, meaning if we do some type of manufacturing business that's custom in some way, then the other things are going to follow from if we make custom guitars, if we make, if we do any kind of construction, it's going to be custom to whatever needs to be done, then we're typically going to be doing a job cost system. Our next characteristic are heterogeneous product products or services. And that just means that they're different. And the reason I use this word is because sometimes you'll see it in textbooks. So heterogeneous and homogeneous heterogeneous being the opposite meaning difference and homogeneous meaning the same. So this of course follows that we can just say, of course, that the types of things we're producing are not all exactly the same. And that follows from the idea that they're they're custom they're different in some way, we've got some differences in the production that we have. And because of those differences, we cannot do things like just allocate the costs evenly to whatever we're making. If one guitar we make is a lot more detailed than another guitar we make, then we cannot evenly allocate the costs. And that's going to be one of the reasons we use a job cost system. If we do a construction job and one happens to be a lot larger than another, then we can't allocate the same cost to those two jobs. So we shouldn't, we should find some other way. And that's why we're going to use a job cost system as opposed to a process cost system, low production volume. Now, low production volume means that we're not producing as many of the items possibly as in a job cost type of inventory system, meaning if we're making custom guitars, then we're going to produce far less of them. That's okay, because we're going to charge a higher price for the ones that we produce, as opposed to if we were just stamping out the guitars and they were all the same, then the idea there is that we're going to have a high volume, less customization. So a job cost system follows from the idea that we're going to have some differentiation, some customness. And that means that the products are going to be different in nature, differences in nature of whatever we make, typically would mean that the production volume will be lower. And then we're going to have high product flexibility. Again, that's going to follow from the idea that they're custom. So if something's going to be different in nature of anything that we're making, that's going to be different. And we might just specialize in even if we're just specialized in guitars. And even if it's fairly limited, if we have the more customization we have within that guitar, the more we're going to need to have a job cost system as opposed to a process cost. If we're in construction, of course, every we might do the same type of construction all the time. But the jobs that we go to and deal with are typically going to be different just by the nature of the job. And so we're going to have to