Equivalent units of production usually are determined for
A) direct materials costs only.
B) direct materials and conversion costs.
C) direct materials and direct labor costs only.
D) conversion costs only.

Question

Quizplus · Accepted Answer

Equivalent units of production are determined for both direct materials and conversion costs. This is because conversion costs include the costs of transforming direct materials into finished products through the use of direct labor and manufacturing overhead. Therefore, it is necessary to calculate equivalent units of production for both direct materials and conversion costs in order to accurately determine the total production cost per unit.

Equivalent Units of Production Usually Are Determined for