The Types of Process Flow under Process Costing: A product can flow through a factory in numerous fashions. There are three Types of Process Flow formats associated with process costing — sequential, parallel, and selective—are illustrated here to indicate that basically the same costing procedures can be applied to all types of process flow or product flow situations.
Three Types of Process Flow under Process Costing:
1. Sequential Process Flow :
In a sequential product flow, each item manufactured goes through the same set of operations. Graphically, this might be shown as:
 
Materials are started I the mixing department. Labor and factory overhead are added when the work is overheated are added; when the work is finished in the Mixing Department, it moves to the refining department. This second process and any subsequent processes any add more materials or simply work on the partially completed input from the preceding process, adding only labor and factory overhead. After the product has been processed by the Finishing department, it is a completed product and becomes a part of Finished Goods.
2. Parallel Process Flow:
In a partial product flow, certain portions of work are done simultaneously and then brought together a in a final process or processes for completion and transfer to Finished Goods. As in the figure
As in the previous illustration, materials may be added in processes subsequent to the first ones.
3. Selective Process Flow:
In a selective product flow the product moves to different departments within the plant, depending upon the desired final product. For example, in meat processing, after the initial butchering process, some of the product goes directly to the Packaging Department and then to Finished Goods; some goes to the Smoking Department and then to the Packaging Department and finally to Finished Goods; some to the Grinding Department, then to the Packaging Department, and lastly to Finished Goods.
Which types of Process Flow will be selected in an industry mostly depends on product processing system.Transfer of costs from the Butchering Department involves consideration of joint cost allocation, which will be discussed later on.
