Answer (C) is correct . Abnormal spoilage is spoilage that is not expected to occur under normal, efficient operating conditions. Because of its unusual nature, abnormal spoilage is typically treated as a loss in the period in which it is incurred.
Answer (A) is incorrect because Abnormal spoilage costs are not considered a component of the cost of good units produced.
Answer (B) is incorrect because The cost of good units produced does not include abnormal spoilage costs.
Answer (D) is incorrect because Abnormal spoilage costs must be taken out of the manufacturing account.
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