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Conversion cost includes cost of converting……… into ……

A. Raw material, WIP

B. Raw material, Finished goods

C. WIP, Finished goods

D. Finished goods, Saleable goods

Answer: Option B

Solution(By Examveda Team)

Conversion cost includes cost of converting Raw material into Finished goods. There are two main components of conversion costs: direct labor and manufacturing overheads.

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