Answer:
Total equivalent units 56,700
Explanation:
<em>Equivalent Units E.U) are notional whole units which represent incomplete work and are used to apportion costs between between work in progress and completed work.
</em>
To compute as
Equivalent Units = Degree of completion (%) × units
We will assume the company uses weighted average method of accounting for work-in progress.
<em>Under the weighted average method of valuation, to account for completed units, it is assumed that the entire degree of work required is done in the period under consideration. So there is no separation of the completed units into opening inventory and fully worked.</em>
Completed units = opening inventory + transferred in - closing inventory
= 2,600 + 62,500 - 21,000 = 44,100
Items Units Equivalent unit
Completed units 44,100 44,100× 100% = 44,100
Closing inventory 21,000 21,000 ×60% = <u>12,600
</u>
Total equivalent units <u> 56,700
</u>
