BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094
BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094

Solutions

Chapter
Section
Chapter 18, Problem 18.3BPE
Textbook Problem

Prime and conversion costs

Identify the following costs as a prime cost (P), conversion cost (C), or both (B) for a magazine publisher:

  1. a. Paper used for the magazine
  2. b. Wages of printing machine employees
  3. c. Glue used to bind magazine
  4. d. Maintenance on printing machines

Expert Solution
To determine

Prime cost:

Prime cost refers to a cost which is directly involved in the process of manufacturing an item. Prime cost includes direct materials, direct labor and other direct overheads.

Conversion cost:

A conversion cost refers to the cost of converting the raw materials into a finished product. Conversion cost includes direct labor as well as the manufacturing overhead costs.

To identify: The prime cost and the conversion cost of the given items of an magazine publisher.

Explanation of Solution

The prime cost and the conversion cost of each items of an automobile manufacturer are identified as follows:

Sl. No Particulars Prime cost (P) / Conversion cost (C) / Both (B)
a Paper used for the magazine Prime cost (P)
b Wages of printing machine employees Both (b)
c Glue used to bind magazine Both (b)
d Maintenance on printing machines Conversion cost (C)

Table (1)

  1. a) Paper used for the magazine comes under the prime cost...

Want to see this answer and more?

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

See solution

Chapter 18 Solutions

Accounting
Show all chapter solutions
Ch. 18 - Management process Three phases of the management...Ch. 18 - Management process Three phases of the management...Ch. 18 - Direct materials, direct labor, and factory...Ch. 18 - Direct materials, direct labor, and factory...Ch. 18 - Prime and conversion costs Identify the following...Ch. 18 - Prime and conversion costs Identify the following...Ch. 18 - Product and period costs Identify the following...Ch. 18 - Product and period costs Identify the following...Ch. 18 - Cost of goods sold, cost of goods manufactured...Ch. 18 - Cost of goods sold, cost of goods manufactured...Ch. 18 - Classifying costs as materials, labor, or factory...Ch. 18 - Classifying costs as materials, labor, or factory...Ch. 18 - Classifying costs as factory overhead Which of the...Ch. 18 - Classifying costs as product or period costs For...Ch. 18 - Concepts and terminology From the choices...Ch. 18 - Concepts and terminology From the choices...Ch. 18 - Classifying costs in a service company A partial...Ch. 18 - Sustainability and eco-efficiency measures Four...Ch. 18 - Classifying costs The following report was...Ch. 18 - Financial statements of a manufacturing firm The...Ch. 18 - Manufacturing company balance sheet Partial...Ch. 18 - Cost of direct materials used in production for a...Ch. 18 - Cost of goods manufactured for a manufacturing...Ch. 18 - Cost of goods manufactured for a manufacturing...Ch. 18 - Income statement for a manufacturing company Two...Ch. 18 - Statement of cost of goods manufactured for a...Ch. 18 - Cost of goods sold, profit margin, and net income...Ch. 18 - Cost flow relationships The following information...Ch. 18 - Uses of managerial accounting in a service company...Ch. 18 - Classifying costs The following is a list of costs...Ch. 18 - Classifying costs The following is a list of costs...Ch. 18 - Cost classifications for a service company A...Ch. 18 - Manufacturing income statement, statement of cost...Ch. 18 - Statement of cost of goods manufactured and income...Ch. 18 - Classifying costs The following is a list of costs...Ch. 18 - Classifying costs The following is a list of costs...Ch. 18 - Cost classifications for a service company A...Ch. 18 - Manufacturing income statement, statement of cost...Ch. 18 - Statement of cost of goods manufactured and income...Ch. 18 - Ethics in Action Avett Manufacturing Company...Ch. 18 - Communication Todd Johnson is the vice president...Ch. 18 - Managerial accounting in the management process...Ch. 18 - Classifying costs Geek Gut Company provides...Ch. 18 - Using managerial accounting Information The...

Additional Business Textbook Solutions

Find more solutions based on key concepts
Show solutions
What are the various forms of business organization? What are the advantages and disadvantages of each?

Fundamentals Of Financial Management, Concise Edition (mindtap Course List)

What does the invisible hand of the marketplace do?

Principles of Economics (MindTap Course List)

At what amount are purchases recorded under the net-price method?

College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)

EXPECTED INTEREST RATE The real risk-free rale is 3%. Inflation is expected to be 2% this year and 4% during th...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)