Questions:
1. Discuss the distinguishing features of process costing.
2. What do you understand by ‘normal loss' and ‘abnormal loss'? How would you treat them in process cost accounts?
3. What is equivalent production? What is its effect on computed unit costs?
4. In what type of industries, a process costing system is generally applied? What would influence a cost accountant in deciding whether to apply a process or job cost system?
5. Describe the general features of process costing. Name three industries where process costing can be applied.
6. State the fundamental principles of process costing.