ECONOMICS

Detailed explanation-1: -Identify the losses and output. Calculate the cost of good output, losses and WIP. Use the costs you have calculated to assign values to the good output, losses and WIP.

Detailed explanation-2: -Process costing is used when output is produced in a continuous process system, and it is difficult to separate individual units of output.

Detailed explanation-3: -Process costing involves tracking the number of units passing through the production process during a given period, collecting cost information for each stage and then using the collected information to calculate per-unit cost.

Detailed explanation-4: -Process costing is used when there is mass production of similar products, where the costs associated with individual units of output cannot be differentiated from each other. In other words, the cost of each product produced is assumed to be the same as the cost of every other product.