How are equivalent units calculated in a process costing system?
A)By adding the units started to the equivalent units in beginning and ending inventory
B)By adding the units completed to the equivalent units in ending Work in Process
C)By subtracting the equivalent units in beginning inventory from the total units to account for
D)By adding the units started to the equivalent units in ending inventory

Question

Quizplus · Accepted Answer

Equivalent units are calculated based on the percentage of completion of units in process. Thus, the units completed in the period are added to the equivalent units in ending Work in Process to get the total equivalent units for the period.

How Are Equivalent Units Calculated in a Process Costing System