ECONOMICS

Detailed explanation-1: -Process Costing Method is applicable where the output results from a continuous or repetitive operations or processes. Products are identical and cannot be segregated. It enables the ascertainment of cost of the product at each process or stage of manufacture.

Detailed explanation-2: -Process costing is a type of operation costing which is used to ascertain the cost of a product at each process or stage of manufacture. CIMA defines process costing as “The costing method applicable where goods or services result from a sequence of continuous or repetitive operations or processes.

Detailed explanation-3: -Process Costing: In industries where a continuous process of production is carried and the product is homogeneous, the method of ascertaining the cost of the product is called Process Costing.

Detailed explanation-4: -job costing method is used. For assigning indirect costs (overheads) models such as Activity Based Costing may be used. 2. Process costing method: In process costing system the cost of a service is obtained by assigning costs to masses of similar unit and then computing unit cost on an average basis.

Detailed explanation-5: -Process costing is a method of costing under which all costs are accumulated for each stage of production or process, and the Page 2 2 cost per unit of product is ascertained at each stage of production by dividing the cost of each process by the normal output of that process.