Question

Management of Lewallen Corporation has asked your help as an intern in preparing some key reports for September. Direct materials cost was $64,000, direct labor cost was $50,000, and manufacturing overhead was $78,000. Selling expense was $22,000 and administrative expense was $39,000.

The conversion cost for September was:

$128,000
$150,000
$192,000
$125,000

Answer 1

The conversion cost for Lewallen Corporation for September is calculated by adding direct labor cost ($50,000) to manufacturing overhead ($78,000), which totals $128,000.

Step-by-step explanation:

The student's question relates to the calculation of conversion cost, which in manufacturing accounting, is the sum of direct labor cost and manufacturing overhead. To find the conversion cost for Lewallen Corporation for September, simply add the provided direct labor cost of $50,000 to the manufacturing overhead of $78,000. Therefore, the conversion cost is $50,000 + $78,000 = $128,000.