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Conversion Cost do not include? 1-Indirect Material. 2-Direct Material. 3-Indirect Labour.

Accounting Auditing Financials Costing
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Question added by Mobeen Tahir , Credit Officer , Tawuniya Insurance
Date Posted: 2015/02/19
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Saifullah Shirazi
by Saifullah Shirazi , Senior Accountant , Suraj Cotton Mills Limited

Direct Material + Direct Labor = Prime Cost

Direct Labor + Factory Overhead = Conversion Cost

so the right answer to above question is Direct Materil

Lesley Lanag CMA CPA
by Lesley Lanag CMA CPA , Senior Accountant , Takaful Emarat Insurance (P.S.C)

Direct material which is a prime cost .

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