Larsen Corp. manufactures car seats in its Sarnia 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 Corp. 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 Corp. uses the weighted-average method of process costing. Data for the assembly department for October 2015 are:

Required
1. For each cost category, compute equivalent units of work done in October 2015 in the assembly department. Show physical units in the first column of your schedule.
2. For each cost category, summarize total assembly department costs for October 2015 and calculate the cost per equivalent unit.
3. Assign total costs to units completed and transferred out and to units in ending work in process.

Transcribed Image Text:

Physical Units Direct Conversion (car seats) Materials Costs Work in process, October 1* Started during October 2015 Completed during October 2015 Work in process, October 31 Total costs added during October 2015 * Degree of completion: direct materials, ?%; conversion costs, 60%. 5,000 S1,250,000 S 402,750 20,000 22,500 2,500 S4,500,000 S2,337,500 t Degree of completion: direct materials, ?%; conversion costs, 70%.