If variances are not prorated at the end of the accounting period,they are closed to the Cost of Goods Sold.

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If variances are not prorated at the end of the accounting period, they are closed to the Cost of Goods Sold, which means that they are treated as period costs. This is because the variances represent the difference between the actual costs incurred and the standard costs, and they are not allocated to specific products or production runs. Therefore, they are considered as an expense of the period and are included in the Cost of Goods Sold.

If Variances Are Not Prorated at the End of the Accounting