Ellie's Candies, Inc produces gummy bears
The company purchases raw materials, stores them in a warehouse, and then runs them through two processes: production and packaging. During September, the production process incurred the following costs in processing 20,000 gummy bears:
Wages of workers operating production equipment $50,500
Manufacturing overhead allocated to the production department 8,000
Direct materials 210,000
Use the FIFO method to compute the September conversion costs in the Production Department.
A) $58,500
B) $268,500
C) $50,500
D) $8,000
A .A) Conversion costs = Direct labor + Manufacturing overhead = $50,500 + $8,000 = $58,500
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