Chapter 20, Problem 8RQ

To determine

Concept introduction:

Process costing system: Process costing systems is a system to assign the costs where the production goes through different processes. A product may take several processes to complete and when these processes are separable, the process costing system is applied to ascertain the cost of each process.

Conversion Costs: Conversion costs are manufacturing costs which are incurred to convert the raw material into finished good. These costs include direct labor and overheads.

To explain: Conversion costs and its use in process costing system