. . . . . . . . process loss should be transferred to costing profit & loss account.

abnormal
normal
Both A and B
None of these

The correct answer is: A. abnormal

Abnormal process losses are those that are not expected to occur under normal operating conditions. They are usually caused by factors such as equipment failure, human error, or unexpected changes in the production process. Abnormal process losses should be transferred to the costing profit & loss account as they are not part of the normal cost of production.

Normal process losses are those that are expected to occur under normal operating conditions. They are usually caused by factors such as the inherent nature of the product or the production process. Normal process losses are not transferred to the costing profit & loss account as they are considered to be part of the normal cost of production.

The following are some examples of abnormal process losses:

  • Scrap caused by equipment failure
  • Damage to products caused by human error
  • Loss of products due to unexpected changes in the production process

The following are some examples of normal process losses:

  • Shrinkage of products due to drying or evaporation
  • Loss of products due to normal spoilage
  • Defects in products that are not considered to be significant enough to warrant rework or scrap