Which of the following costs incurred by a paper manufacturer would be included in the group of costs referred to as conversion costs?
A) accounting department costs
B) raw lumber
C) assembly labor's wages
D) administrative salaries

Question

Quizplus · Accepted Answer

Conversion costs refer to the costs incurred to convert raw materials into finished goods. Assembly labor's wages directly contribute to the conversion process, and therefore, are included in conversion costs. Accounting department costs and administrative salaries are categorized as period costs, while raw lumber is considered a direct material cost.

Which of the Following Costs Incurred by a Paper Manufacturer