normal spoilage

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Definition of normal spoilage

Normal spoilage is the unavoidable part of spoilage occurs in a production process. It will occur even the production process is operated with the highest efficiency. That is why it is also known as predetermined or planned spoilage.

Manufacturers typically set a rate of normal spoilage based on their product type. Cost of normal spoilage is included in cost of goods produced. Thus, Good units absorb the cost of normal spoilage.

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