Conversion cost

conversion cost
Refers to the sum of manufacturing direct labor and overhead
costs of products. The cost of raw materials used to make products
is not included in this concept. Generally speaking, this is a rough measure ...

conversion costs
The combination of a manufacturer's direct labor and factory overhead.
» For more clarity on this term: ...

conversion cost
cost of moving from one kind of equipment or production process to another. Conversion cost is high when converting from a manual system to a computerized system. It includes the cost of new equipment plus training.
Related Terms: ...

Conversion costs: All manufacturing costs other than direct materials.

Cost: Resources sacrificed to achieve a specific objective.

Conversion Costs. The costs required to convert raw materials into finished product; including direct labor and overhead.

Conversion costs - Direct labour + manufacturing overhead.
Convertible currency - Any national currency that can be easily exchanged for that of another country.
Cook the books - To falsify is misrepresent accounting information.

Conversion Costs = Direct Labor + Manufacturing Overhead
Prime costs are the components that are direct in nature. Conversion costs are the components to change raw materials to finished goods.

Conversion cost is direct labour cost plus manufacturing overhead cost.
Conversion Ratio
The conversion ratio is the number of common shares to be received in exchange for a convertible security.

Prime Costs and Conversion Costs
The term Prime Cost refers to the sum of Direct Labor cost + Direct Material cost.
The term Conversion Cost refers to the sum of Direct Labor cost + Manufacturing Overhead cost.

Conversion cost: the cost of bringing a product or service into its present location or condition. May include a share of production overheads.

Conversion Cost (in accounting)
Indirect Labor (in accounting)
Indirect Material (in accounting)
Manufacturing Costs (in accounting)
Service Department Costs (in accounting)
Cost-Volume Formula (in accounting)
Activity Base (in accounting) ...

You can easily compute the 'standard cost' of this mug in terms of material, labor, and overhead (an older way), or in terms of material plus cost of acquisition, plus fixed and variable conversion costs (a newer way
By John L. Mariotti ...

The company in effect buys a claim on a series of floating interest payments by agreeing to make fixed interest payments, giving the company the benefits of a fixed rate loan without incurring additional loan origination/conversion costs.

See also: Direct labor, Expense, Cost of goods, Fixed costs, Fixed cost