Question

Which of the following statements is true of normal spoilage and abnormal spoilage?

a) Both are avoidable
b) Both are considered variable costs
c) Normal spoilage is inherent, while abnormal spoilage is avoidable
d) Abnormal spoilage is inherent, while normal spoilage is avoidable

Answer 1

Normal spoilage is inherent and expected during production, while abnormal spoilage is excessive and avoidable, often caused by unusual circumstances.

Step-by-step explanation:

The statement that is true of normal spoilage and abnormal spoilage is: Normal spoilage is inherent, while abnormal spoilage is avoidable. Normal spoilage is expected to occur under efficient operating conditions and is often factored into the cost of production. On the other hand, abnormal spoilage exceeds the amount expected under efficient operating conditions and is often caused by factors like faulty machinery or human error, meaning it can typically be avoided. Controlling abnormal spoilage is important as it directly affects the bottom line of a manufacturing business. Accounting for these costs differently allows managers to maintain better control over the production process and associated costs