Larner Company Uses the Weighted-Average Method in Its Process Costing

question 11

Multiple Choice

Larner Company uses the weighted-average method in its process costing system.Operating data for the first processing department for the month of June appear below:

According to the company's records,the conversion cost in beginning work-in-process inventory was $68,064 at the beginning of June.Additional conversion costs of $585,324 were incurred in the department during the month.
What was the cost per equivalent unit for conversion costs for the month? (Round off to three decimal places.)

• A) $5.575.
• B) $6.174.
• C) $6.892.
• D) $7.090.

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Definitions:

Incremental Manufacturing Cost

The additional cost incurred to produce one more unit of a product, often considered for decision-making in production processes.

Product Costs

Costs that are directly associated with the creation of a product, including direct materials, direct labor, and manufacturing overhead.

Period Costs

Expenses that are not directly associated with manufacturing and are charged as costs during the period they occur, including general, selling, and administrative costs.

Variable Cost

A cost that varies with the level of output or sales, such as materials and labor costs.