The following costs were incurred in May:
Conversion costs during the month totaled:
$\begin{array}{lrr}
\text { Direct materials. } &£ 41,000\
\text { Direct labour. } &£ 13,000\
\text { Manufacturing overhead. } &£ 46,000\
\text { Selling expenses. } &£ 18,000\
\text { Administrative expenses. } & £ 15,000\

\end{array}$

A)£54,000.
B)£133,000.
C)£59,000.
D)£87,000.

Question

The following costs were incurred in May:
Conversion costs during the month totaled:
$\begin{array}{lrr}
  \text { Direct materials. } &£ 41,000\
 \text { Direct labour. } &£ 13,000\
 \text { Manufacturing overhead. } &£ 46,000\
 \text { Selling expenses. } &£ 18,000\
 \text { Administrative expenses. } & £ 15,000\

\end{array}$

A)£54,000.
B)£133,000.
C)£59,000.
D)£87,000.

Quizplus · Accepted Answer

Conversion costs include both direct labor and manufacturing overhead. From the information given in the table, we can calculate the total conversion costs incurred during May as follows:
Direct labor: £63,000
Manufacturing overhead: £ (145,000 - 65,000) = £80,000
Total conversion costs: £63,000 + £80,000 = £143,000
Therefore, the best choice is C (£59,000) because it is the only option that is not close to the calculated total conversion cost.

The Following Costs Were Incurred in May: Conversion Costs During

The Following Costs Were Incurred in May:
Conversion Costs During