The proration method of disposing of overhead variances assigns the variance in proportion to the sizes of the ending account balances of ________.
A)work-in-process inventory,finished goods inventory and direct material inventory
B)work-in-process inventory,direct material inventory and cost of goods sold
C)work-in-process inventory and direct materials inventory
D)work-in-process inventory,finished goods inventory and cost of goods sold

Question

Quizplus · Accepted Answer

The proration method of disposing of overhead variances assigns the variance to work-in-process inventory, finished goods inventory, and cost of goods sold. Direct material inventory is not included in the proration method. Therefore, option D is the correct choice.

The Proration Method of Disposing of Overhead Variances Assigns the Variance