The Molding Department of Oriole Company has the following production data: beginning work process 39600 units (60% complete), started into production 734000 units, completed and transferred out 688000 units, and ending work in process 85600 units (40% complete). Assuming materials are entered at the beginning of the process, equivalent units for materials are:

Total equivalent units  720,240  units

Explanation:

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.

Equivalent Units = Degree of completion (%) × units

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.

so we assumed that the 688,000 units were started and  completed in the same period .

Item                                   unit                                     Equivalent unit

Completed and trans.   688,000    688,000× 100% = 688,000

Closing WIP                    85,600    85,600 ×  40%  =   34,240

Total equivalent unit                                                       720,240

b is the correct answer