According to one embodiment, an image processing apparatus includes an image reading device, a storage device, and a control unit. The image reading device reads an image on a sheet. The storage device stores information. The control unit that determines a detection area of an encoded image based on a teacher image which is an image read from a predetermined teacher sheet by the image reading device, records information indicating the detection area in the storage device, detects an encoded image in the detection area among the images read from a sheet to be read after the teacher sheet, and decodes the detected encoded image.