In cost accounting, it’s important to understand the classifications of costs. Prime costs include direct materials and direct labor, while conversion costs consist of direct labor and manufacturing overhead. Therefore, any cost that is part of both categories will be direct labor, as it is a cost incurred during production that relates to both material usage and the conversion of that material into finished products.
To summarize, the product cost that is both a prime cost and a conversion cost is direct labor because it is essential for both acquiring raw materials and transforming them into final products.