A company had the following information pertaining to two different cases:

-Prorating the variances refers to assigning the variances to
A) cost of goods sold only.
B) inventories and cost of goods sold.
C) inventories only.
D) inventories, cost of goods sold, and sales.

Question

A company had the following information pertaining to two different cases:
 
-Prorating the variances refers to assigning the variances to
A) cost of goods sold only. 
B) inventories and cost of goods sold. 
C) inventories only. 
D) inventories, cost of goods sold, and sales.

Quizplus · Accepted Answer

Prorating the variances involves distributing them between inventories and cost of goods sold to reflect the actual costs more accurately.

A Company Had the Following Information Pertaining to Two Different