Conversion costs consist of:
A)all costs of production.
B)raw materials and direct labor.
C)direct labor and manufacturing overhead.
D)raw materials and manufacturing overhead.

Question

Quizplus · Accepted Answer

Conversion costs refer to the costs incurred to convert raw materials into finished products. These costs include direct labor and manufacturing overhead, such as wages, salaries, benefits, depreciation on machinery and equipment, rent, utilities, and other indirect costs associated with running a factory. Raw materials are not included in conversion costs because they are considered a separate input into the production process.

Conversion Costs Consist Of