Q199
Conversion cost includes cost of converting……… into ……
A.
Raw material, WIP
B.
Raw material, Finished goods
AnswerC.
WIP, Finished goods
D.
Finished goods, Saleable goods
Answer: Option B
Solution
Answer: Option B
Solution:
Conversion cost includes cost of converting Raw material into Finished goods. There are two main components of conversion costs: direct labor and manufacturing overheads.