Deck 18: Spoilage, rework, and Scrap

Question 1

Rework is residual material that results from manufacturing a product and can have either a high or low sales value relative to the product with which it is associated.

Answer 1

False
Explanation:Scrap is residual material that results from manufacturing a product.Examples are short lengths from woodworking operations,edges from plastic molding operations,and frayed cloth and end cuts from suit-making operations.Scrap can sometimes be sold for relatively small amounts.

Question 2

Which of the following is an example of spoilage?

A)short lengths from woodworking operations that cannot be used to make another product
B)edges from plastic molding operations that result from the main product's manufacturing process but have little or no value
C)defective units of laptops detected after the production process but reworked before the units are sold as good products to customers
D)defective men's button down cotton collar dress shirts that have small pulls in the material and must be sold as discounted "seconds" in the factory store

Answer 2

D

Question 3

Rework is finished production that is NOT in accordance with customer desires.The product is redone and sold as finished goods.

Answer 3

True

Question 4

Spoilage that is not inherent in a particular production process and would not arise under efficient operating conditions is referred to as ________.

A)incremental spoilage
B)usual spoilage
C)abnormal spoilage
D)indirect spoilage

Question 5

Spoilage that is an inherent result of the particular production process and arises even under efficient operating conditions is referred to as ________.

A)incremental spoilage
B)normal spoilage
C)irregular spoilage
D)direct spoilage

Question 6

Costs of abnormal spoilage are usually accounted for as ________.

A)a deduction from the cost of goods sold
B)a component of the costs of good units manufactured
C)a separate line item in an income statement
D)an asset on a balance sheet

Question 7

Reworked goods are unacceptable units of production usually NOT capable of being repaired or converted into a salable product.

Question 8

Which of the following best describes scrap?

A)units of production that do not meet the specifications required by customers but that are subsequently repaired and sold as good finished units
B)products of a joint production process that have low total sales values relative to the total sales value of the main product
C)residual material that results from manufacturing a product
D)units of production whether fully or partially completed,that do not meet the specifications required by customers for good units and are discarded or sold at reduced prices

Question 9

An item classified as spoilage has no value.

Question 10

Some amounts of spoilage,rework,or scrap are inherent in many production processes.

Question 11

Costs of normal spoilage are usually accounted for as ________.

A)a deduction from the cost of goods sold
B)a component of the costs of good units manufactured
C)a "loss from normal spoilage account" in income statement
D)a liability on a balance sheet

Question 12

Which of the following is an example of scrap?

A)short lengths from woodworking operations that must be discarded
B)defective units of laptops detected after the production process but reworked before the units are sold as good products to customers
C)defective aluminum cans sold to aluminum manufacturers for remelting to produce other aluminum products
D)defective shirts,jeans,shoes,and carpeting sold as seconds

Question 13

Which of the following defines spoilage?

A)units of production that do not meet the specifications required by customers but that are subsequently repaired and sold as good finished units
B)units of production whether fully or partially completed,that do not meet the specifications required by customers for good units and are discarded or sold at reduced prices
C)residual material that results from manufacturing a product
D)products of a joint production process that have low total sales values relative to the total sales value of the main product

Question 14

There is no difference between scrap which can be sold for relatively small amount and a byproduct.

Question 15

Distinguish among spoilage,reworked units,and scrap.Give an example of each.

Question 16

A leather shoe manufacturer makes "duck" boots that consist of leather and rubber.Some of the books are defective and are sold in the factory store at deep discounts.Leather strips from the cutting process and rubber shavings are byproducts of the process.The leather strips have no use and are discarded while the rubber scraps are collected and periodically picked up by a recycling company at no cost to the shoe manufacturer.Which of the following classifications of these items would be accurate?

A)the defective boots are spoilage and the leather and the rubber are scrap
B)the defective boots,leather and rubber are scrap but the shoes are more valuable scrap as they can be sold
C)the defective boots are spoilage ,the leather strips are scrap,and the rubber is rework
D)all three items are spoilage

Question 17

Scrap and rework are considered to be the same thing by managerial accountants.

Question 18

Which of the following describes rework?

A)units of production that do not meet the specifications required by customers but that are subsequently repaired and sold as good finished units
B)products of a joint production process that have low total sales values relative to the total sales value of the main product
C)units of production whether fully or partially completed,that do not meet the specifications required by customers for good units and are discarded or sold at reduced prices
D)residual material that results from manufacturing a product

Question 19

For each of the following items identify whether it is spoilage,reworked units,or scrap.

Question 20

The loss from abnormal spoilage account would appear ________.

A)on a balance sheet
B)as a detailed item in the retained earnings schedule of a balance sheet
C)a separate line item on an income statement
D)a deduction from the cost of goods sold

Question 21

Normal spoilage is spoilage that is NOT considered to be inherent in a production process.

Question 22

There is a tradeoff between the speed of production and the normal spoilage rate.

Question 23

Companies calculate the units of abnormal spoilage and record the cost in the Loss from Abnormal Spoilage account,which appears as a separate line item in an income statement.

Question 24

Abnormal spoilage is spoilage that should arise under efficient operating conditions.

Question 25

Normal spoilage rates are computed by dividing units of normal spoilage by total good units completed,NOT total actual units started in production.

Question 26

Costs of abnormal spoilage are considered inventoriable and are written off as a period expense.

Question 27

Normal spoilage is usually regarded as avoidable and controllable.

Question 28

The costs of normal spoilage are typically included as a component of the costs of good units manufactured.

Question 29

Units spoiled due to machine breakdowns and operator errors are normal spoilage.

Question 30

Under efficient operating conditions,all spoilage is considered to be abnormal spoilage.

Question 31

Which one of the following conditions usually exists when comparing normal and abnormal spoilage to controllability?

B)Normal is Controllable and Abnormal is Uncontrollable
C)Normal is Uncontrollable and Abnormal is Uncontrollable
D)Normal is Uncontrollable and Abnormal is Controllable

Question 32

Line operators and other plant personnel generally can decrease or eliminate normal spoilage by identifying the reasons for machine breakdowns,operator errors.

Question 33

Abnormal spoilage is spoilage inherent in a particular production process.

Question 34

A company produces 11,000 units of which 600 are spoiled units because the process,even though carefully and efficiently executed is unable to produce good units 100% of the time.Another 80 units are spoiled because machines broke down and there also were operator errors.What is the normal spoilage rate (round to two decimal places)

A)6)18%
B)5)81%
C)5)45%
D)0)73%

Question 35

Spoilage can be considered either normal or abnormal.

Question 36

Companies that attempt to achieve zero defects in the manufacturing process treat spoilage as ________.

A)scrap
B)reworked units
C)abnormal spoilage
D)indirect spoilage

Question 37

Which of the following statements is true of normal spoilage?

A)It is a spoilage which is not inherent in a particular production process.
B)It occurs due to machine breakdowns and operator errors.
C)It is usually regarded as avoidable and controllable.
D)It arises even when the process is carried out in an efficient manner.

Question 38

Which of the following statements is true of an abnormal spoilage?

A)It is a spoilage which is inherent in a particular production process.
B)It arises even when the process is carried out in an efficient manner.
C)It is usually regarded as avoidable and controllable.
D)The costs of abnormal spoilage are typically included as a component of the costs of good units manufactured.

Question 39

Which of the following statements is true of normal spoilage and abnormal spoilage?

A)Normal spoilage is inherent in a particular production process,whereas abnormal spoilage is not inherent in a particular production process.
B)Abnormal spoilage arises even when the process is carried out in an efficient manner,whereas normal spoilage does not arise when the process is carried out in an efficient manner.
C)Normal spoilage is usually regarded as avoidable and controllable,whereas abnormal spoilage is unavoidable and uncontrollable.
D)The costs of normal spoilage are recorded as a loss as a separate line item in an income statement,whereas costs of abnormal spoilage are included as a component of the costs of good units manufactured.

Question 40

Costs of abnormal spoilage are separately accounted for as losses of the period.

Question 41

Outose Concept manufactures small tables in its Processing Department.Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some units are spoiled due to undetectable materials defects.Inspection occurs when units are 60% converted.Spoiled units generally constitute 6% of the good units.Data for December 2017 are as follows:

Costs for December:

What is the number of total spoiled units?

A)10,435 units
B)4338 units
C)4162 units
D)8500 units

Question 42

Fish Fillet Incorporated obtains fish and then processes them into frozen fillets and then prepares the frozen fish fillets for distribution to its retail sales department.Direct materials are added at the initiation of the cycle.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some fillets are spoiled due to undetectable defects.Inspection occurs when units are 45% converted.Spoiled fillets generally constitute 6% of the good fillets.Data for April 2017 are as follows:

Costs for April:

What is the total cost per equivalent unit using the weighted-average method of process costing? (Round any cost per unit calculations to the nearest cent. )

A)$3.38
B)$2.02
C)$2.03
D)$4.05

Question 43

Colil Computer Systems,Inc. ,manufactures printer circuit cards.All direct materials are added at the inception of the production process.During January,the accounting department noted that there was no beginning inventory.Direct materials of $301,000 were used during the month.Work-in-process records revealed that 11,000 card units were started in January,5500 card units were complete,and 5400 card units were spoiled as expected.Ending work-in-process card units are complete in respect to direct materials costs.Spoilage is not detected until the process is complete.
What is the amount allocated to the work-in-process ending inventory? (Round any cost per unit calculations to the nearest cent. )

A)$49,235
B)$59,321
C)$2736
D)$75,240

Question 44

What are the objectives in accounting for spoilage?

Question 45

Colil Computer Systems,Inc. ,manufactures printer circuit cards.All direct materials are added at the inception of the production process.During January,the accounting department noted that there was no beginning inventory.Direct materials of $310,000 were used during the month.Work-in-process records revealed that 12,000 card units were started in January,6000 card units were complete,and 4600 card units were spoiled as expected.Ending work-in-process card units are complete in respect to direct materials costs.Spoilage is not detected until the process is complete.
What is the direct material cost per equivalent unit? (Please round the final answer to the nearest cent. )

A)$17.22
B)$25.83
C)$21.68
D)$29.99

Question 46

The inspection point is the ________.

A)stage of the production cycle where products are checked to determine whether they are acceptable or unacceptable units
B)point at which costs are allocated between normal and abnormal spoilage
C)point at which the calculation of equivalent units is made
D)stage of allocating total costs transferred out to good units completed and transferred

Question 47

Outose Concept manufactures small tables in its Processing Department.Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some units are spoiled due to undetectable materials defects.Spoiled units generally constitute 4% of the good units.Data for December 2017 are as follows:

Costs for December:

Normal spoilage totals ________.

A)3180 units
B)6800 units
C)2908 units
D)3892 units

Question 48

Fish Fillet Incorporated obtains fish and then processes them into frozen fillets and then prepares the frozen fish fillets for distribution to its retail sales department.Direct materials are added at the initiation of the cycle.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some fillets are spoiled due to undetectable defects.Spoiled fillets generally constitute 4% of the good fillets.Data for April 2017 are as follows:

Costs for April:

Abnormal spoilage totals ________.

A)8440 units
B)0 units
C)7560 units
D)16,000 units

Question 49

Fish Fillet Incorporated obtains fish and then processes them into frozen fillets and then prepares the frozen fish fillets for distribution to its retail sales department.Direct materials are added at the initiation of the cycle.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some fillets are spoiled due to undetectable defects.Inspection occurs when units are 40% converted.Spoiled fillets generally constitute 6% of the good fillets.Data for April 2017 are as follows:

Costs for April:

What cost is allocated to abnormal spoilage using the weighted-average process-costing method? (Round any cost per unit calculations to the nearest cent. )

A)$ 0
B)$4610
C)$2091
D)$2106

Question 50

Colil Computer Systems,Inc. ,manufactures printer circuit cards.All direct materials are added at the inception of the production process.During January,the accounting department noted that there was no beginning inventory.Direct materials of $301,000 were used in production during the month.Work-in-process records revealed that 12,000 card units were started in January,6000 card units were complete,and 4000 card units were spoiled as expected.Ending work-in-process card units are complete in respect to direct materials costs.Spoilage is not detected until the process is complete.
What is the direct material cost assigned to good units completed? (Please round interim calculations to the nearest cent,and final calculations to the nearest whole dollar. )

A)$150,480
B)$258,000
C)$100,320
D)$250,800

Question 51

What is the distinction between normal and abnormal spoilage?

Question 52

Fish Fillet Incorporated obtains fish and then processes them into frozen fillets and then prepares the frozen fish fillets for distribution to its retail sales department.Direct materials are added at the initiation of the cycle.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some fillets are spoiled due to undetectable defects.Spoiled fillets generally constitute 4% of the good fillets.Data for April 2017 are as follows:

Costs for April:

What is the amount of direct materials and conversion costs assigned to ending work in process using the weighted-average process-costing method? (Round any cost per unit calculations to the nearest cent. )

A)$2025;$42,749
B)$50,700;$15,470
C)$96,730;$101,227
D)$101,227;$25,229

Question 53

Outose Concept manufactures small tables in its Processing Department.Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some units are spoiled due to undetectable materials defects.Spoiled units generally constitute 5% of the good units.Data for December 2017 are as follows:

Costs for December:

What cost is allocated to abnormal spoilage using the weighted-average process-costing method? (Round any cost per unit calculations to the nearest cent. )

A)$ 0
B)$28,150
C)$25,177
D)$77,200

Question 54

Outose Concept manufactures small tables in its Processing Department.Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some units are spoiled due to undetectable materials defects.Spoiled units generally constitute 3% of the good units.Data for December 2017 are as follows:

Costs for December:

Abnormal spoilage totals ________.

A)2430 units
B)8100 units
C)5913 units
D)2187 units

Question 55

Fish Fillet Incorporated obtains fish and then processes them into frozen fillets and then prepares the frozen fish fillets for distribution to its retail sales department.Direct materials are added at the initiation of the cycle.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some fillets are spoiled due to undetectable defects.Spoiled fillets generally constitute 5% of the good fillets.Data for April 2017 are as follows:

Costs for April:

Normal spoilage totals ________.

A)9200 units
B)0 units
C)22,000 units
D)12,800 units

Question 56

Outose Concept manufactures small tables in its Processing Department.Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some units are spoiled due to undetectable materials defects.Inspection occurs when units are 55% converted.Spoiled units generally constitute 5% of the good units.Data for December 2017 are as follows:

Costs for December:

What is the amount of direct materials and conversion costs assigned to ending work in process using the weighted-average process-costing method? (Round any cost per unit calculations to the nearest cent. )

A)$40,484;$49,644
B)$74,860;$51,870
C)$74,100;$52,402
D)$156,293;$12,620

Question 57

Fish Fillet Incorporated obtains fish and then processes them into frozen fillets and then prepares the frozen fish fillets for distribution to its retail sales department.Direct materials are added at the initiation of the cycle.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some fillets are spoiled due to undetectable defects.Inspection occurs when units are 45% converted.Spoiled fillets generally constitute 6% of the good fillets.Data for April 2017 are as follows:

Costs for April:

What is the number of total spoiled units?

A)32,000 units
B)74,420 units
C)7000 units
D)13,000 units

Question 58

Which of the following is true of the calculation of the cost per good unit (a unit that is completed and transferred out)under the weighted-average process costing method?

A)the equivalent units in the denominator include goods completed and transferred out and all units that were spoiled
B)the numerator only includes the materials and conversion costs of good units and excludes the costs of spoiled units
C)the equivalent units in the denominator include goods completed and transferred out and excludes the units that were spoiled
D)the calculation is total costs transferred out divided by the good units that were transferred out

Question 59

Excluding spoiled units in the equivalent-unit calculation results in ________.

A)lower cost per good unit.
B)higher cost per good unit
C)better management information
D)higher cost for spoiled units

Question 60

Outose Concept manufactures small tables in its Processing Department.Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Before inspection,some units are spoiled due to undetectable materials defects.Spoiled units generally constitute 3% of the good units.Data for December 2017 are as follows:

Costs for December:

What is the total cost per equivalent unit using the weighted-average method of process costing? (Round any cost per unit calculations to the nearest cent. )

A)$3.86
B)$3.69
C)$7.90
D)$4.04

Question 61

Verer Custom Carpentry manufactures chairs in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 5% of the good units.Data provided for March 2017 are as follows:



Costs:

What costs are allocated to the ending work-in-process inventory for direct materials and conversion costs,respectively,using the FIFO method of process costing? (Round any cost per unit calculations to the nearest cent. )

A)$64,676;$40,067
B)$28,237;$24,740
C)$28,352;$25,353
D)$28,019;$15,091

Question 62

Samantha's Office Supplies manufactures desk organizers in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 3% of the good units.Data provided for February 2017 are as follows:



Costs:

What costs would be associated with normal and abnormal spoilage,respectively,using the FIFO method of process costing? (Round any cost per unit calculations to the nearest cent. )

A)$20,882;$37,638
B)$13,004;$37,638
C)$14,200;$13,004
D)$25,025;$7879

Question 63

Verer Custom Carpentry manufactures chairs in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 4% of the good units.Data provided for March 2017 are as follows:



Costs:

What are the normal and abnormal spoilage units,respectively,for March when using FIFO?

A)3204 units;1396 units
B)1968 units;1420 units
C)9749 units;1540 units
D)530 units;2032 units

Question 64

Under the FIFO method,all spoilage costs are assumed to be related to the units ________.

A)in beginning inventory,plus the units completed during the period
B)completed during the period,using the unit costs of that period
C)in ending inventory
D)in both beginning and ending inventory plus the units completed during the period

Question 65

The first step in the five-step procedure for process costing with spoilage is to compute the output in terms of equivalent units.

Question 66

Samantha's Office Supplies manufactures desk organizers in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 3% of the good units.Data provided for February 2017 are as follows:



Costs:

What are the direct material and conversion costs of all the units that were initially in the beginning work-in-process inventory and were subsequently shipped? Take into account the costs related to the completion of the conversion of the units during the month.Use the FIFO method of process costing.(Round any cost per unit calculations to the nearest cent. )

A)$78,336;$44,000
B)$0;$47,002
C)$54,835;$48,782
D)$40,239;$18,605

Question 67

Counting spoiled units as part of output units in a process-costing system usually results in a higher cost per unit.

Question 68

Samantha's Office Supplies manufactures desk organizers in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 5% of the good units.Data provided for February 2017 are as follows:



Costs:

What costs are allocated to the ending work-in-process inventory for direct materials and conversion costs,respectively,using the FIFO method of process costing? (Round any cost per unit calculations to the nearest cent. )

A)$1,285,820;$8124
B)$62,816;$32,980
C)$64,291;$8124
D)$40,619;$12,552

Question 69

Under the weighted-average method,the costs of normal spoilage are added to the costs of their related good units.Hence,the cost per good unit completed and transferred out equals the total costs transferred out divided by the number of good units produced.

Question 70

Samantha's Office Supplies manufactures desk organizers in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 4% of the good units.Data provided for February 2017 are as follows:



Costs:

What is the total costs of all the units that were initially in the beginning work-in-process inventory and were subsequently shipped? Take into account the costs related to the completion of the conversion of the units during the month.Use the FIFO method of process costing.(Round any cost per unit calculations to the nearest cent. )

A)$35,363
B)$360,400
C)$395,763
D)$195,016

Question 71

Costs in beginning inventory are pooled with costs in the current period when determining the costs of good units under the weighted-average method of process costing.

Question 72

Verer Custom Carpentry manufactures chairs in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 4% of the good units.Data provided for March 2017 are as follows:



Costs:

What costs would be associated with normal and abnormal spoilage,respectively,using the FIFO method of process costing? (Round any cost per unit calculations to the nearest cent. )

A)$149,611;$5290
B)$1250;$4858
C)$4858;$2297
D)$10,651;$2297

Question 73

Samantha's Office Supplies manufactures desk organizers in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 5% of the good units.Data provided for February 2017 are as follows:



Costs:

What are the total costs of all the units that were started during February and subsequently shipped before the end of the period? (Round any cost per unit calculations to the nearest cent. )

A)$605,673
B)$503,366
C)$560,549
D)$397,248

Question 74

Samantha's Office Supplies manufactures desk organizers in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 3% of the good units.Data provided for February 2017 are as follows:



Costs:

What are the normal and abnormal spoilage units,respectively,for February when using FIFO?

A)3531 units;3132 units
B)5103 units;4014 units
C)5424 units;8676 units
D)5424 units;14,100 units

Question 75

Based on the following information from a company's process costing system that is reporting on the month of May's activity in one of its departments,which journal entries would be correct?


Loss from Abnormal Spoilage $9000

Question 76

Samantha's Office Supplies manufactures desk organizers in its Processing Department.Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the production cycle.Inspection takes place as units are placed into production.After inspection,some units are spoiled due to undetectable material defects.Spoiled units generally constitute 4% of the good units.Data provided for February 2017 are as follows:



Costs:

Which of the following journal entries correctly represents the transfer of completed goods begun during February using the FIFO method of process costing? (Round any cost per unit calculations to the nearest cent. )

Question 77

Under the FIFO method,all spoilage costs are assumed to be related to the units completed during this period using the unit costs of the current period.

Question 78

The last step in the five-step procedure for process costing with spoilage is to summarize total costs to account for.

Question 79

Spoilage and rework costs are thoroughly captured in the accounting system.

Question 80

Spoilage is typically assumed to occur at the stage of completion where inspection takes place.