When calculating equivalent units in a second or later processing department,all physical units should be considered 100% complete with respect to transferred-in work and costs.

Question

Quizplus · Accepted Answer

This is because in a second or later processing department, the units being processed have already undergone the first stage and have been transferred to this department. Thus, these units are considered 100% complete with respect to transferred-in work and costs, and only the additional work done in the second or later department needs to be considered for calculating equivalent units.

When Calculating Equivalent Units in a Second or Later Processing