Question

What does waste increase costs? Give three examples.

Answer 1

Waste also involves materials, time spent by laborers, and other costs associated with its disposal. If there is some waste during production, it should be transferred to other places so that the production is not affected. In these way, waste increase costs. The examples are as follows-

1. Materials, labors, and overheads involved in waste produced.

2. Sometimes, special personnel is required to get rid of waste and a suitable compensation is provided to the personnel.

3. Space occupied by production waste is also an example of waste costs.