Final answer:
If at the end of the fiscal year, the variances from standard are significant, the variances should be transferred to the income statement or profit and loss statement.
Step-by-step explanation:
If at the end of the fiscal year, the variances from standard are significant, the variances should be transferred to the income statement or profit and loss statement. This helps in reflecting the impact of variations from the expected standards on the company's financial performance.
If at the end of the fiscal year, the variances from standard are significant, the variances should be transferred to the cost of goods sold (COGS) account in the income statement. COGS is an important measure in evaluating the profitability and efficiency of a business. Transferring significant variances to the COGS account reflects the impact these variances have on the cost of producing goods and services.