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Cost+Accounting+(15th+Edition)+-+Charles+T.+Horngren.pdf
Weighted-average method. Larsen Company manufactures car seats in its San Antonio plant. Each car seat passes through the assembly department and the testing department. This problem focuses on the assembly department. The process-costing system at Larsen Company has a single direct-cost category (direct materials) and a single indirect-cost category (conversion costs). Direct materials are added at the beginning of the process. Conversion costs are added evenly during the process. When the assembly department finishes work on each car seat, it is immediately transferred to testing.
Larsen Company uses the weighted-average method of process costing. Data for the assembly depart- ment for October 2014 are as follows:
Required
Work in process, October 1aStarted during October 2014 Completed during October 2014Work in process, October 31bTotal costs added during October 2014
Physical Units (Car Seats)
5,000 20,000 22,500
2,500
Direct Materials
$1,250,000
$4,500,000
Conversion Costs
$ 402,750
$2,337,500
ASSIGNMENT MATERIAL 701
aDegree of completion: direct materials,?%; conversion costs, 60%. bDegree of completion: direct materials,?%; conversion costs, 70%.
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