Which of the following statements best describes conversion costs?
A) Conversion costs are all manufacturing and nonmanufacturing costs.
B) Conversion costs are all manufacturing costs other than direct materials costs.
C) Conversion costs are all nonmanufacturing costs including marketing costs.
D) Conversion costs are all nonmanufacturing costs other than fixed selling and distribution costs.

Question

Quizplus · Accepted Answer

Conversion costs are the manufacturing costs required to convert direct materials into finished goods. These costs include direct labor and manufacturing overhead costs, but do not include direct materials costs.

Which of the Following Statements Best Describes Conversion Costs