Companies that compute equivalent units of production do so to:
A)Comply with income tax regulations.
B)Compute total manufacturing costs for the period.
C)Determine a manufacturing overhead application rate.
D)Determine departmental per-unit costs.

Question

Quizplus · Accepted Answer

Companies that compute equivalent units of production do so to determine departmental per-unit costs. Equivalent units of production are calculated to determine how much of the materials, labor, and overhead costs for a given period are assigned to the units of product that were completed and transferred out or are still in process. This information is useful for determining departmental per-unit costs as well as for tracking the efficiency of each department's production process.

Companies That Compute Equivalent Units of Production Do So To