Question

In a process costing system, the calculation of equivalent units is used for calculating the dollar amount of ending inventory the dollar amount of the cost of goods sold for the accounting period the dollar cost of a particular job Both A and B are correct

Answer 1

Answer:

• calculating the dollar amount of ending inventory
• the dollar amount of the cost of goods sold for the accounting period

Explanation:

The calculation of equivalent units main purpose is to convert partially completed units that are still in production, into completed units according to the amount that could be produced using the same amount of inputs.

Once you calculated the equivalent units, you can assign a value to your ending inventory including both finished units and equivalent units. By doing this you can calculate the cost per unit and the COGS for the accounting period.