Question

In a process costing system which assumes that normal spoilage occurs at the end of a process, the cost attributable to normal spoilage should be assigned to

a. Finished goods inventory.
b. Work in process inventory.
c. Cost of goods sold.
d. Scrap revenue.

Answer 1

In a process costing system, the cost attributable to normal spoilage should be assigned to work in process inventory. Normal spoilage refers to the expected amount of waste or defective units that occur naturally during the production process.

Step-by-step explanation:

In a process costing system which assumes that normal spoilage occurs at the end of a process, the cost attributable to normal spoilage should be assigned to b. Work in process inventory.

Normal spoilage refers to the expected amount of waste or defective units that occur naturally during the production process. These units are not considered as finished goods and are part of the work in process inventory.

Assigning the cost of normal spoilage to the work in process inventory allows for an accurate reflection of the costs incurred in the production process and helps in calculating the overall cost of production.