process costing pdf

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5 Limitation of process costing.

Process costing is a form of operations costing which is used where standardized homogeneous goods are produced. This costing method is used in industries like chemicals, textiles, steel, rubber, sugar, shoes, petrol etc. Process costing is also used in the assembly type of industries also.



The following are limitations of process costing

  • Cost obtained at
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Break-even point - meaning and formula

6 advantages of the process costing

Process costing is a form of operations costing which is used where standardized homogeneous goods are produced. This costing method is used in industries like chemicals, textiles, steel, rubber, sugar, shoes, petrol etc. Process costing is also used in the assembly type of industries as well.

The following are advantages of the process costing

  • Costs are to be computed periodically
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Abnormal loss - meaning and example

Abnormal loss – meaning and example

An abnormal loss is also called an uncontrollable loss. It is a loss that is not expected to occur under efficient operating conditions.

It is not considered an inherent part of the production process because it arises from inefficiencies and is not included in the process costs. An example would be incorrect mixing of ingredients or cutting of fabric.  



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