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The Kelso Division of the Cowlitz Corp. produces and sells a product to outside and internal customers. Unit data collected from their operations include Outside
The Kelso Division of the Cowlitz Corp. produces and sells a product to outside and internal customers. Unit data collected from their operations include Outside sales price Direct materials Fixed overhead Prime costs Conversion costs Per Unit $250 40 70 100 If Kelso is operating at capacity and selling solely to outside customers, what price should another division have to pay for Kelso's product? a. $245 b. $250 c. $110 d. $185 If Kelso has excess capacity available to meet an internal order, what price should be dictated? a. $245 b. $210 c. $170 d. $115
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