Chapter 16: 13RQ (page 885)
What are prime costs? Conversion costs?
Prime cost is the combination of direct cost and conversion cost is the combination of direct labor and manufacturing overhead.
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Identify each cost as a period cost or a product cost. If it is a product cost, further indicate if the cost is direct materials, direct labor, or manufacturing overhead. Then determine if the product cost is a prime cost and/or a conversion cost.
9. Sugar and flour used to make cookies
Explain the difference between a direct cost and an indirect cost.
Identifying product costs and period costs Classify each cost of a paper manufacturer as either a product cost or a period cost:
c. Cost of electricity at the paper mill
What are the three manufacturing costs for a manufacturing company? Describe each.
Identifying product costs and period costs Classify each cost of a paper manufacturer as either a product cost or a period cost:
b. Cost of computer software to track WIP Inventory
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