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11. Which of the following statements best describes conversion costs? A) Conversion costs are all manufacturing and nonmanuf
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Answer #1

Conversion costs are the manufacturing expenses incurred to convert raw materials into finished goods.

Thus, Conversion costs are all manufacturing costs other than direct material costs.

Conversion costs = Direct labor + Manufacturing overheads

Correct option is (B)

Non manufacturing costs like selling, general and administration expenses are not included in the Conversion costs.

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