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    Question

    In a manufacturing entity, the cost of abnormal waste

    is:
    A Added to closing inventory Correct Answer Incorrect Answer
    B Deferred to next period Correct Answer Incorrect Answer
    C Charged to Cost of Goods Sold Correct Answer Incorrect Answer
    D Capitalized Correct Answer Incorrect Answer
    E Expensed in P&L Correct Answer Incorrect Answer

    Solution

    Abnormal waste is charged directly to the Profit and Loss account and not included in inventory cost.

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