Proration of manufacturing cost variances among ending inventories and cost of goods sold has the effect of carrying the cost (savings) of inefficient (efficient) operations of a period to:
A) Only the balance sheet of the current period.
B) Only the income statement of the current period.
C) The balance sheets of future periods only.
D) The income statement of the current period and the balance sheet of the current period.

Question

Quizplus · Accepted Answer

Proration of manufacturing cost variances would result in carrying the cost (savings) of inefficient (efficient) operations of a period to both the income statement and the balance sheet of the current period.

Proration of Manufacturing Cost Variances Among Ending Inventories and Cost