ECONOMICS

Detailed explanation-1: -Definition: Equivalent units of production (EUP) is a managerial accounting calculation that estimates the number of units that could have been started and completed if all resources were devoted to these units during a period.

Detailed explanation-2: -Equivalent units of production is a term applied to the work-in-process inventory at the end of an accounting period.

Detailed explanation-3: -Why is it necessary to use EUP in process costing? Equivalent units of production reflect the partial and completed work in terms of completed work, and therefore, it helps in determining the total work done.

Detailed explanation-4: -Equivalent units of output (equivalent units) are the completed units that could have been produced given the total amount of productive effort made for a given period.