If abnormal spoilage occurs in a job-order costing system, has a material dollar value, and is related to a specific job, the recovery value of the spoiled goods should be

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The recovery value of abnormal spoilage should be recorded in a scrap inventory account and charged to the specific job in process as a loss. This ensures that the cost of the goods is not allocated to other jobs or absorbed into overhead costs. Option B is incorrect because overhead is not related to the specific job in process. Option C is incorrect because a loss account is used when there is no recovery value, while in this case, there is a recovery value. Option D is incorrect because factory overhead sales are not related to abnormal spoilage.

If Abnormal Spoilage Occurs in a Job-Order Costing System, Has