Chapter 9, Problem 24E

Which of the following is true concerning labor variances that are not material in amount?

1. a. They are closed to Cost of Goods Sold.
2. b. They are prorated among Work in Process, Finished Goods, and Cost of Goods Sold.
3. c. They are prorated among Materials, Work in Process, Finished Goods, and Cost of Goods Sold.
4. d. They are reported as part of Overall Variance on the balance sheet at the end of the year.