Select the correct formula for computing equivalent units for the period under the weighted average approach.
A) Equivalent units = Units transferred
B) Equivalent units = Units transferred + (Ending inventory units × Percentage complete)
C) Equivalent units = Units transferred + Ending inventory units
D) Equivalent units = (Units transferred + Ending inventory units) × Percentage complete

Question

Quizplus · Accepted Answer

The correct formula for computing equivalent units under the weighted average approach is: Equivalent units = Units transferred + (Ending inventory units × Percentage complete). This accounts for both the units fully processed and transferred out, and the portion of work done on units still in process at the end of the period.

Select the Correct Formula for Computing Equivalent Units for the Period