Which of the Following Is False Concerning Equivalent Units

question 79

Multiple Choice

Which of the following is false concerning equivalent units?

• A)Equivalent units are calculated separately for each cost category.
• B)Equivalent units are equal to physical units.
• C)Equivalent units measure output in terms of the physical quantities of the inputs consumed.
• D)Equivalent units are necessary when process costing is used.
• E)The number of equivalent units may be identical for direct materials and for conversion costs.

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Definitions:

Cash Ratio

A metric assessing the capacity of a business to settle short-term debts with its available cash and near-cash assets.

Inventory Turnover

A metric demonstrating the rate at which a company's inventory turnover occurs, signaling the proficiency of its inventory handling over a defined period.

Inventory Turnover

A measure of how quickly a company sells and replaces its stock of goods within a given time period.

Receivables Turnover

A measure of how efficiently a company collects on its credit sales, calculated as sales divided by average accounts receivable.