Question

15,000 units in a process that are 70% complete are referred to as:

a) 15,000 equivalent units of production
b) 4,500 equivalent units of production
c) 10,500 equivalent units of production
d) 4,000 equivalent units of production
e) none of these

Answer 1

(c) 10,500 equivalent units of production

Step-by-step explanation:

Equivalent units of production helps manufacturing companies determine the average completed or finished products. Additionally, since there are many items in continuous production, without calculation of equivalent units, it would be difficult to determine how much money was incurred in production costs.

Using the formula

The number of partially completed units (15,000) x percentage of completion (70%) = equivalent units of production (10, 500)