Conversion Costs Include Materials, Direct Labor, and Factory Overhead

question 178

True/False

Conversion costs include materials, direct labor, and factory overhead.

---

Definitions:

Goods

Tangible items that are manufactured or produced for sale and consumption.

Separate Business Organization

A separate business organization is an entity that operates independently from other entities or personal affairs of its owners, having its legal rights and obligations.

Sole Proprietorship

A business structure where a single individual owns, operates, and is responsible for all aspects of the business.

Pre-Owned Auto

A previously owned vehicle that is sold in the automotive market, typically having one or more prior owners before the current transaction.