Equivalent Units of Production – True or False

Practice Question

Intro to Managerial Accounting
Process Cost Accounting
Equivalent Units of Production
True or False

Equivalent units of production measure the work done during a period expressed in fully completed units.

Answer +
Correct Answer: TRUE
Explanation +

This concept is critical in process cost accounting for determining the cost per unit of completed product. It accounts for both completed and partially completed units, ensuring accurate cost allocation.