If Standard Cost Variances Are Allocated (I

Multiple Choice

If standard cost variances are allocated (i.e. ,prorated) to inventory and cost of goods sold (CGS) accounts at the end of a period,which of the following is correct?

A) Conceptually,the amount allocated to each account is based on the relative amount of the current period's standard cost in the end-of-period balance in each account.
B) The resulting balances represent relative actual cost in each of the affected accounts.
C) There is a presumption that the net variance for the period is immaterial in amount.
D) The amount allocated to inventories is generally larger than the amount allocated to CGS.