The combined costs of direct labor and factory overhead per equivalent unit used by many businesses with process operations is called:
A) Combined cost per equivalent unit
B) Overhead cost per equivalent unit
C) Physical cost per equivalent unit
D) Finished cost per equivalent unit
E) Conversion cost per equivalent unit

Question

Quizplus · Accepted Answer

The combined costs of direct labor and factory overhead per equivalent unit is called the conversion cost per equivalent unit. This cost represents the expenses incurred in converting raw materials into finished goods. Therefore, the best choice is E.

The Combined Costs of Direct Labor and Factory Overhead Per