Process losses, Cost Accounting

Assignment Help:

Process Losses

Most manufacturing processes result in several portion of the raw materials utilized not being transformed into a reliable half losses.  These losses may take the form of scrap, and rework, waste, and spoilt units.

  1. Waste: are materials lost in the process that are irrecoverable or have no recoverable value.
  2. Scrap: Material held after a productive process that are irrecoverable or have no recoverable value.
  3. Rework: These are finished goods such do not meet quality standards however which along with some additional work can be sold.
  4. Loss: Refers to finished or partially finished units that cannot be reworked or employed for their intended purpose. They may be discarded or sold for minimal value. There are two kinds of spoilage as;

A. Normal Loss: such is loss unavoidable and expected even beneath the most efficient systems of production.  Normal spoilage cost is normally involved in product cost.

B. Abnormal Spoilage:  This is loss which is avoidable along with efficient operating conditions. The cost is regarded as controllable and can be eradicated if due supervision and diligence are exercised. The cost is generally treated as a loss and charged to loss and profit account.


Related Discussions:- Process losses

Purpose of cost accounting information, Purpose of Cost Accounting Informat...

Purpose of Cost Accounting Information Cost accounting is employed for a number of reasons, some of that are briefly described in the given points as: a) Accounting for co

What is cmm, CMM is an internationally recognized standard for calculating ...

CMM is an internationally recognized standard for calculating the maturity of an organization's software development processes and has become the primary benchmark multinational co

calculate the percent interest rate and effective cost, 1. The following t...

1. The following three one-year "discount" loans are available toyou: Loan A: $120,000 at a 7 percent discount rate Loan B: $110,000 at a 6 percent discount rate Loan

Accounting for labour costs, Accounting for Labour costs We will conta...

Accounting for Labour costs We will contain an overview of accounting for labour costs as: a) Gross Earnings It is illustrated as item A that appears like a credit i

Specific order costing, Specific Order Costing This is a broad costing...

Specific Order Costing This is a broad costing system that is applicable where work jobs consist of separate jobs, batches or contracts.  Every job or contract or batch is a c

Standards and budgets, Standards and Budgets Budgets like you recall f...

Standards and Budgets Budgets like you recall from the previous section, are simply plans for expected future performance expressed in quantified monetary terms. Therefore the

Planning, what is planning and what part of this activity would you describ...

what is planning and what part of this activity would you describe as planning in the situasion above

Prepare a flexible overhead budget, Under a contract with the provincial go...

Under a contract with the provincial government, ChemLabs Inc. analyzes the chemical and bacterial composition of well water in various municipalities in the interior of British Co

Explanation of total cost line, Total costs include both variable costs and...

Total costs include both variable costs and fixed costs. Variable costs are costs which can beeasily identified or related to a cost per unit or activity level of some kind for exa

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd