Which Option(s)would Be Consistent with the Proration Approach for End-Of-Period

question 75

Multiple Choice

Which option(s) would be consistent with the proration approach for end-of-period adjustments when the underallocated or overallocated variable overhead costs are significant?

• A)prorate based on the allocated overhead amount in the ending balance of work-in-process inventory and cost of goods sold
• B)immediate write-off to cost of goods sold
• C)prorate based on the total ending balance of variable overhead allocated and variable overhead control
• D)prorate based on the allocated overhead amount in the ending balance of work-in-process inventory, finished goods inventory, and cost of goods sold
• E)prorate based on the total ending balance of cost of goods sold and variable overhead control

---

Definitions:

Nominal GDP

The market value of all final goods and services produced within a country in a year, measured using current prices.

Real GDP

The value of all goods and services produced within a country adjusted for inflation or deflation.

Base Year

A specific year against which economic growth is measured by comparing other years to it in terms of prices, outputs, or employment.

Nominal GDP

Gross Domestic Product measured at current market prices, without adjusting for inflation, reflecting the value of all goods and services produced by a country within a specific period.