Prime Costs and Conversion Costs

[@tremanrolls679]

nice - brushing up on the material before my final exam - thanks a ton.

[@midapita]

You explained this much more simply than my textbook haha, thank you so much!

[@alessandropierre8920]

thank you sir, you've just helped me up yesterday

[@agustdofficial8945]

Same here with me, my english is extremely broken but i can probably understand what he said

[@hchu578]

Your explanations are helping me a ton getting these concepts in my brain!!!! Thank you!!

[@wildwindownorway]

I am foraging youtube for last-minute knowledge. ACCA MA exam tomorrow. thank you

[@MacrWest]

much easier to understand thank you!

[@MyFinancialFocus]

Great explanation!

[@andresantoniocastroperez8429]

Excellent clear and concise. One question please ,conversion costs is what a maquila manufacturer pays for and prime costs what he put tin on his own?

[@francescociccone2224]

well explained

[@miguelzamora3722]

super helpful thank you so much!

[@craigdean11]

thanks for the video, really helped out :)

[@uciaok]

A little bit more of “why”s would be better. What’s the purpose of arranging data into these sets? Is it for better number recording only? Is it for future cost reduction decision making? It seems like different purposes will lead to different settings. Or is this a general way of recording so that manager could extract useful info from these numbers for higher goals. A lot of these insights I think would be profoundly useful for people just getting started on these subjects.

[@bustercrabbe8447]

How would this apply to the fishing industries? How do you do managerial Accounting for the fishing industry? Thank you.

[@MsSuperspirit]

You are the best 😊

[@IntanShafaxlx]

Is the Direct Labor cost will be separate into how much is for the prime cost, how much is the conversion cost? Or we can use all of the Direct Labor cost (the USD 25) to calculate prime and conversion cost?

[@sarpcakc56]

well explained, great video

[@lungelozain3100]

Professor i just wanna say i love and appreciate all your videos. I have a question though about what you said about the conversion costs at 2:47 ( "how much does it cost to convert those raw materials into products").Can you please clarify what you meant on that. Thank you!

[@Edspira]

Let's say we have aluminum and we want to make aluminum cans. The aluminum is the raw material, and conversion costs (direct labor and manufacturing overhead) are the costs we incur to transform the aluminum into an aluminum can. For example, the depreciation incurred on the equipment we use to convert the aluminum into aluminum cans would be considered a conversion cost.

[@suadahmed_6]

You help a lot I want say thank you so much

[@nintijackson1952]

You just saved a life😪

[@tlj6034]

Hi, this is great. Does the production quantity matter? For example, If those were the cost of DM, DL, and MOH for 2013 and you produced 100,000 units. Do you still calculate if like the way you did on the video or do you have to times DL, DM, and MOH before calculating the prime cost or the conversion cost?

[@yoshinegus4019]

It depends if the info is given as "per unit" or a total amount

[@vector224sxls]

Thank you

[@Edspira]

No problem!

[@srenaggerhougaard8801]

can you have opening stock or closing stock of direct labour?

[@sharminhossain457]

excellent

[@MacSipma]

nice!

[@Edspira]

Thank you!

[@MusicalMoon]

legend !

[@alextung2902]

This video is great However, direct labor count twice and "double counting problem" may appear. How to solve it? Thanks

[@MrDymix]

+Alex Tung Hi Alex. You wouldn't use them at the same time. For example, the conversion cost is to be compared with direct material cost. So how much would it cost to convert $100 of materials into products? The conversion price which (in this example) is $75. Then the finished cost would be $175. On the other hand, if you would want to see onle the prime cost (as in MOH isn't interesting or negligeble), then you can just add material cost and labour cost. Makes sense? :)

[@alextung2902]

+MrDymix Hello, MrDymix. Oh, I understand. Thank you very much ^^

[@MyIdelMind]

thanks :D

[@tatianatee8879]

u are a god

[@wafamk4565]

and what if we have to determine the prime cost .. if the conversion.C =80000 & T.manufacturing cost =140000 & MOH = 75% of the prime cost ??

[@PieEater]

gioat

[@mahendrakrisnamurti9599]

let's put a case where the only info consists of DM 10,000 conversion cost 20,000. There is no DL and MOH info. How can we determine DL and MOH based on this case?

[@yoshinegus4019]

you can't. thats like saying x=20, how did we get there? 19+1 18+2 17+3... could all be right.

[@junreycasino4426]

Avery corporation's northwestern factory provided the following information for the calendar yr. Beginning Inventory; direct materials $59, 800 work in process. $58,500 ending inventories direct material. $21,500 work in process. $23,500 during the year, direct material purchases amounted to $150,000 direct labor cost was $200,000 and the overhead cost was $324,700. There we're 100,000 units produced. Question; 1.calculate the total cost of direct materials used in production; 2. calculate the cost of goods manufactured, calculate the unit manufacturing cost . 3. of the unit manufacturing cost calculated in requirements 2, assume $1.70 is direct materials and $3.24 overhead. What is the prime cost per unit? conversion cost per unit. Help me to answer those requirements

[@Ehmohtional]

Thank you!

[@wafamk4565]

and what if we have to determine the prime cost .. if the conversion.C =80000 & T.manufacturing cost =140000 & MOH = 75% of the prime cost ??