The cost of direct materials varies in pharmaceuticals. The rate you pay depends on how much you purchase and from what vendor you use when you make purchases.
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Conversion cost is total of: Options Direct material and direct wages Direct material, direct wages, and production overheads Direct wages and production overheads. None of the above
Direct Cost:These are all those costs which directly related and allocatable to manufacturing of units of products like direct material (raw meterial), Direct labor (Salaries or wages of workforce) etc.Indirect Cost:These are those costs which are not directly allocatable to manufacturing of units of products like salary of line manager in factory or supervisors salary etc.
The answer will depend of where in the world you are: labour and material costs vary enormously.The answer will depend of where in the world you are: labour and material costs vary enormously.The answer will depend of where in the world you are: labour and material costs vary enormously.The answer will depend of where in the world you are: labour and material costs vary enormously.
Well, honey, if manufacturing overhead is 20% of total conversion costs, and direct labor is $38,000 and direct materials are $47,000, then total conversion costs would be $38,000 + $47,000 = $85,000. So, if manufacturing overhead is 20% of that, it would be 0.20 x $85,000 = $17,000. So, the manufacturing overhead would be $17,000.
Factory manager is not directly related to the production of units of product so it is not direct labor cost but it is included in overhead costs.