Question

Compute conversion costs given the following data: direct materials, $347,500; direct labor, $196,300; factory overhead, $187,900; and selling expenses, $45,290. a. $543,800b. $187.900 c. $731,700 d. $384.200

Answer 1

Answer:

Conversion costs: d. $384,200

Explanation:

Conversion costs are the costs incurred on activities that convert raw material to finished goods. Conversion costs are calculated by using following formula:

Conversion costs = Direct labor + Factory overhead.

In the case: Direct labor  are $196,300; Factory overhead are $187,900

Therefore:

Conversion costs = $196,300 + $187,900 = $384,200