What are the five steps in a process-costing system and how are equivalent units calculated?
The five steps in a process-costing system are 1 summarize the flow of physical units of output 2 compute the output in terms of equivalent units 3 summarize the total costs to account for 4 compute the cost per equivalent unit and 5 assign the total costs to units completed and to units in ending work in process inventory.
An equivalent units is a derived measure of output that a takes the quantity of each input factor of production in units completed or in incomplete units in work in process and b converts the quantity of input into the amount of completed output units that could be made with that quantity of input.