Which of the Following Statements Is(are) True

Which of the following statements is(are) true?
(A) If variances are prorated at the end of the accounting period, an unfavorable direct materials price variance will, when prorated, increase the value of the Finished Goods Inventory.
(B) Insignificant variances are not generally prorated at the end of the accounting period and are closed to the Cost of Goods Sold.

A) Only A is true.
B) Only B is true.
C) Both of these are true.
D) Neither of these is true.

Correct Answer:

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