An economic process monitoring procedure is presented using a surrogate variable for the case where performance variable is dichotomous. Every item is inspected with a surrogate variable and determined whether it should be accepted or rejected. When an item is rejected, the previous number of consecutively accepted items is compared with a predetermined number r to decide whether there is a shift in fraction nonconforming or not. The conditional distribution of the surrogate variable given the performance variable is assumed to be normal. A cost model is constructed which includes costs of inspection, misclassification, illegal signal, undetected out-of-control state, and correction. Methods of finding the optimum number r and screening limit are provided. Numerical studies on the effects of cost coefficients are also performed.