HaulAll Inc. had a per-unit conversion cost of $4.00 during May and incurred a direct materials cost of $100,000, direct labour costs of $110,000, and manufacturing overhead costs of $50,000. How many units did HaulAll manufacture during May?
A) 18,000
B) 30,000
C) 40,000
D) 70,000

Question

Quizplus · Accepted Answer

The total conversion cost is the sum of direct labor and manufacturing overhead, which is $110,000 + $50,000 = $160,000. Given the per-unit conversion cost is $4.00, the number of units manufactured is $160,000 / $4.00 = 40,000 units.