Perfect Pad manufacturers floor mats for trailers that are used to transport horses. The mats provide for a

firm footing surface that quickly sheds water. Mats are made to customer specifications via orders submitted over an internet site. The mats are completed and shipped in about one day. As a result, Perfect Pad does not maintain any work in process or finished goods inventory.

The following costs were incurred in producing and selling mats during August:

Synthetic rubber used in the mat	$213,500
Lubricant used in the molding machine	15,500
Factory rent	10,600
Electricity to run the molding machine	2,800
Labor cost of machine operators	45,100
Internet sales site	2,300
Administrative salaries	14,500
Depreciation of molding machine	7,800
Salary of factory safety inspector	4,100
Office rent	14,400

Evaluate these costs, and determine the amount of direct material, direct labor, factory overhead, and selling/general/administrative costs. Next, identify how much is considered to be a "prime cost" and how much is considered to be a "conversion cost."

A.

direct material	$213,500
direct labor	45,100
factory overhead	44,860
selling/general/administrative costs	31,200
prime cost	258,000
conversion cost	85,900

B.

direct material	$218,500
direct labor	45,100
factory overhead	40,600
selling/general/administrative costs	31,200
prime cost	258,600
conversion cost	85,900

C.

direct material	$213,500
direct labor	45,500
factory overhead	40,800
selling/general/administrative costs	31,000
prime cost	258,600
conversion cost	85,900

D.

direct material	$213,500
direct labor	45,100
factory overhead	40,800
selling/general/administrative costs	31,200
prime cost	258,600
conversion cost	85,900

E.

direct material	$213,500
direct labor	45,100
factory overhead	30,800
selling/general/administrative costs	31,200
prime cost	258,600
conversion cost	86,900

F.

None of the above