Which of the following is true regarding the disposition of materials and labor variances?
A) The variances for materials and labor are closed directly to Cost of Goods Sold regardless of materiality.
B) If the materials price variance is material, it is prorated among Materials Inventory, Materials Usage Variance, Work in Process, and Finished Goods.
C) The materials usage variance and the labor variances, if material, are prorated among Work in Process, Finished Goods, and Cost of Goods Sold.
D) The materials usage variance and the labor variances are always prorated among Work in Process, Finished Goods, and Cost of Goods Sold.
E) The materials usage variance and the labor variances are always closed to Cost of Goods Sold.
C
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