The Total Conversion Cost Formula According to Accounting Coach, conversion costs refer to the costs involved in converting raw materials into finished goods.

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Learn about the differences between prime costs and conversion costs, and how each type is used in business operations.

But as sales increased, so did the total cost of returns. First, returns represent a “de-conversion” where the sale is lost.

California, however, recently upped its reimbursement for conversions from 50% to 75% of the total cost. Keep in mind that new trucks can get up to 100% reimbursement.

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Alvarez said that change is a big help for making conversions more competitive. “That means for some of our customers, they might get 90% of the total conversion cost covered by these incentives ...