Costs of Abnormal Spoilage Are NOT Considered to Be Inventoriable

question 80

True/False

Costs of abnormal spoilage are NOT considered to be inventoriable costs and are written off as costs of the accounting period in which the abnormal spoilage is detected.

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Definitions:

Income From Operations

The earnings generated from a company’s core business activities, excluding any gains or losses from investments and other non-operational sources.

Invested Assets

Assets acquired by a company or individual as a means of generating future income.

Investment Turnover

A measure of a company's efficacy in using its assets to generate revenue, calculated by dividing sales by the average investment.

Profit Margin

is the percentage of revenue that remains as profit after all expenses are subtracted from sales.