In 'Process Costing', normal loss is: MCQ with Answer and Explanation

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In 'Process Costing', normal loss is:

A. Valued at cost per unit and debited to Profit & Loss Account

B. Valued at scrap value, and cost per unit is adjusted

C. Not recorded separately; its cost is absorbed by good units

D. Shown as an asset

Answer: Option B

Solution (By JKExamLibrary)

Normal loss is expected; its scrap value, if any, reduces the cost of good units. The loss quantity is deducted, and cost per unit is computed on input minus normal loss.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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