When Abnormal Rework Is Distinguished from Normal Rework, and Charged

When abnormal rework is distinguished from normal rework, and charged to a separate loss account, which of the following is a likely result?

A) Prices will have to increase on the company's products accordingly.
B) The amount of normal spoilage unfavourable efficiency variances will be less.
C) The amount of normal spoilage unfavourable efficiency variances will be more.
D) The amount of normal spoilage unfavourable efficiency variances will be unchanged.
E) The abnormal spoilage variance will be closed to cost of goods manufactured.

Correct Answer:

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