In a process cost system, the cost attributable to abnormal losses that occur due to unexpected circumstances such as machine operator error should be assigned to: a. Ending work in process inventory.
b. Cost of goods manufactured and ending work in process inventory in the ratio of units worked on during to units remaining in work in process inventory
c. A separate loss account in order to highlight production inefficiencies
d. Cost of goods manufactured (transferred out)

Adrawback of short-term contracting as an alternative to making a component in-house is thata. it is the most-integrated alternative to performing an activity so the principal company has no control over the agent. b. the supplying firm has no incentive to make any transaction-specific investments to increase performance or quality. c. it fails to allow a long planning period that individual market transactions provide. d. the buying firm cannot demand lower prices due to the lack of a competitive bidding process.