Conversion Costs Are

question 15

Multiple Choice

Conversion costs are

• A) direct materials and direct labor
• B) direct materials and factory overhead
• C) factory overhead and direct labor
• D) direct materials and indirect labor

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Definitions:

Indirect Product Cost

Costs associated with production that are not directly attributable to a specific product, such as maintenance and factory overhead.

Rent

A periodical payment made by a tenant to an owner for the use of premises, land, or a building.

Production Factory

A facility equipped with machinery and labor force focused on manufacturing goods or processing materials.

Cost Of Goods Manufactured

The total expense incurred to produce goods within a specific period, including labor, material, and overhead costs.