Abnormal spoilage costs generally appear in the external financial accounts:
A) on the statement of financial position as part of work in process
B) on the statement of profit or loss as part of some other item
C) on the statement of financial position as part of finished goods
D) on the statement of profit or loss as a line item 'loss on abnormal spoilage'

Question

Quizplus · Accepted Answer

Abnormal spoilage costs are typically included in the statement of profit or loss but not as a separate line item. Instead, they are often accounted for within the cost of goods sold or some other expense category, reflecting the unexpected nature of these costs and their impact on operational efficiency and profitability.

Abnormal Spoilage Costs Generally Appear in the External Financial Accounts