ECONOMICS

Detailed explanation-1: -If actual output exceeds expected output an abnormal gain occurs. and abnormal loss or gain) – ie cost per unit for a period is total cost divided by expected output. reconcile the process account. Abnormal loss (a cost) is credited to the process account: abnormal gain (a benefit) is debited to the process account.

Detailed explanation-2: -Abnormal Gain: If the actual production units are more than the anticipated units after deducting the normal loss, the difference between the two is known as abnormal gain. It is excluded from total cost due to which it does not affect the cost per unit of the product.

Detailed explanation-3: -The least compensation which justifies a corporation is normal profit, which occurs when total revenues equal total costs. When a company earns a profit that is higher than usual, this is known as abnormal profit.

Detailed explanation-4: -An Abnormal loss is a loss that exceeds the usual. What is abnormal gain? It is the gap between substantial losses and projections. Units of abnormal loss or gain are valued at the entire cost per unit, the same as regular output units. Abnormal loss refers to any financial loss due to anything unexpected.

Detailed explanation-5: -Abnormal gains are usually gains of a non-recurring nature. For example, an unrealised gain from currency hedging would be written back as an abnormal because it is not congruent with the normal operations of the business.