What you understand by abnormal cost and abnormal gain in costing?

Abnormal cost is a cost which is not normally incurred at a given level of output in the conditions in which that level of output is normally obtained. (Example: destruction due to fire; lockout; shut down of machinery etc.)

 Abnormal Gain is when actual loss is less than estimated loss.

 

 

 

While studying Process Costing I came through these terms but one was different

Here you mentioned Abnormal Cost, we studied as Abnormal Loss.

Any how,

Abnormal Loss was when actual loss was more than estimated, maybe due to idle time, spillages or bad quality material used.

and

Abnormal Gain was when due to better material used and due to technology use, actual gain is more than estimated one.

amnormal gain simply means that the gain beyond what we expect and abnornal loss means the loss which occure due to some accidental reason like poor quality of materials..fire..strike lockout etc are the reason for abnormal loss in accounting the we can use an equation that abnormal gain=actual output- expected output... abnormal loss=expected output-actual output