Question

Stetson Manufacturing builds custom wooden cabinets. Identify each of the following items as to catego item is a prime or conversion cost. (Select "Both" if an item is both a prime and conversion cost.) Cost of Hardware (Slides, Handles, etc) Cost of Wood Depreciation on Production Equipment Factory Property Taxes Factory Rent Glue Production Supervisor Salary Utilities for Factory Wages for Maintenance Workers Wages of Assembly Workers Wages of Finishing Workers roduct Costs PrimelConversion Cost MOH bL MOH MOH MOH МОН MOH Conversion Cost Prime Cost Conversion Cost Conversion Cost Conversion Cost onversion Cost Conversion Cost Both Both References Problem Difficulty: 2 Medium or opport

Answer 1

Solution:

Particulars	Product Costs	Prime / Conversion Costs
Cost of Hardware (Slides, Handles etc)	DM	Prime Cost
Cost of Wood	DM	Prime Cost
Depreciation on Production Equipment	MOH	Conversion Cost
Factory Property taxes	MOH	Conversion Cost
Factory Rent	MOH	Conversion Cost
Glue	MOH	Conversion Cost
Production Supervisor Salary	MOH	Conversion Cost
Utilities for Factory	MOH	Conversion Cost
Wages for Maintenance Workers	MOH	Conversion Cost
Wages of Assembly Workers	DL	Both
Wages of Finishing Workers	DL	Both