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Costing treatment..

Roma sahu (student) (38 Points)

31 October 2013

plzzz telll me.... what iz the treatment of normal and abnormall loss of material...???

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2 Replies

Back in the Game (a) (1273 Points)
Replied 31 October 2013

Normal loss wil be charged to cost of the product ,abnormal will be transferred to profit and loss...

VIKASH KUMAR JAIN (Audit Executive) (711 Points)
Replied 31 October 2013

Normal loss is a process loss and therefore anticipated while abnormal loss is occured due to unexpected events.So normal loss will form part of cost of production will be apportioned to units actually produced during the period While abnormal loss will be debited to p/l account to reduce conpanies income during the period.Further reason for such abnormal loss will form part of notes of accounts as disclosure.