In: Accounting
Vignana Corporation manufactures and sells hand-painted clay figurines of popular sports heroes. Shown below are some of the costs incurred by Vignana for last year:
Cost of clay used in production | $ 68,000 |
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Wages paid to the workers who paint the figurines | $ 95,000 |
Wages paid to the sales manager's secretary | $ 27,000 |
Cost of junk mail advertising | $ 44,000 |
What is the total of the conversion costs above?
Conversion cost consists of direct labor and manufacturing overhead cost. Here, direct labor is Wages paid to the workers who paint the figurines and there is no manufacturing overhead here. |
Conversion cost = Wages paid to the workers who paint the figurines = 95000 |