Question

What do you mean by normal and abnormal loss?

Answer 1

Normal loss is the misfortune that happens because of the nature of the products consigned. Its tendency is as per the following:

• It happens because of unavoidable reasons.
• It is because of natural losses like misfortunes ordinary spillage, waste, breakdown, evaporation drying, and so on

• It becomes a part of the cost of products sold.

Abnormal Losses might emerge because of accidents, and shortcomings. This misfortune isn’t normal and can be protected by having appropriate consideration. Its temperament is as per the following:

• It is unnatural and avoidable.
• It emerges because of reasons like fire, revolt, flood, burglary, street mishap, and so on.

Also read: Abnormal Loss