Asked by
Carlton Taylor
on Oct 11, 2024
Verified
Conversion cost is the sum of direct labor cost and manufacturing overhead cost.
Conversion Cost
The combined costs of direct labor and manufacturing overheads that are incurred in the process of converting raw materials into finished goods.
Manufacturing Overhead
Indirect factory-related costs that are incurred when a product is manufactured, including costs like rent, utilities, and maintenance of equipment.
- Understand the principles of prime cost and conversion cost along with their elements.
Verified Answer
MO
Learning Objectives
- Understand the principles of prime cost and conversion cost along with their elements.