The Kelso Division Produces and Sells a Product to External

question 102

Multiple Choice

The Kelso Division produces and sells a product to external and internal customers. Per-unit information about its operations include: $\begin{array}{l}\begin{array}{lr}\text { Selling price per unit to external customers } & \$ 250 \\\text { Variable manufacturing costs per unit } & 115 \\\text { Fixed manufacturing overhead costs per unit } &70\end{array}\\\end{array}$
If Kelso is operating at capacity and has unlimited external customer demand, what should be the transfer price for Kelso's product?

• A) $245
• B) $250
• C) $115
• D) $185

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Definitions:

Persistent Depressive Disorder

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