
In case of any doubt, please comment below
American Car Co has two dividons Electrical and Fabrication Fabrication has offered to purchase 90.000 batteries fr...
The American Battery Company has two divisions, the Electrical Division and the Assembly Division. Both divisions have the full authority to make purchasing and selling decisions of their division output to both outsiders and the other division. (A highly decentralized structure) Each Division operates as a separate profit center and is being evaluated on the basis of the divisionʹs reported profit. The Electrical Division makes the battery cores (inside components) of the battery, and the Assembly Division places those cores...
Spark Ltd has two divisions, assembly and electrical. The assembly division transfers partially completed components to the electrical division at a predetermined transfer price. The assembly division's standard variable production cost per unit is $550. This division has spare capacity, and it could sell all its components to outside buyers at $680 per unit in a perfectly competitive market. Required: a) Determine a transfer price using the general rule.(2 marks) b) How would the transfer price change if the assembly...
Fremont Computer Company has been purchasing carrying cases for
its portable computers at a purchase price of $67 per unit. The
company, which is currently operating below full capacity, charges
factory overhead to production at the rate of 50% of direct labor
cost. The unit costs to produce comparable carrying cases are
expected to be as follows:
Direct materials
$40
Direct labor
20
Factory overhead (50% of direct labor)
10
Total cost per unit
$70
If Fremont Computer Company manufactures...
1. The Bash Company has two divisions—Office and Home . The divisions have the following revenues and expenses: Office Home Sales 800,000 900,000 Variable costs (280,000) (200,000) Direct fixed costs (430,000) (320,000) Allocated corporate costs (120,000) (250.000) Net income (loss) (30,000) 130,000 The management at Bash is pondering the elimination of the Office Division. If the Office Division were eliminated, its direct fixed costs could be avoided, but its total corporate costs would not be affected. Given these data, the...
1. The Bash Company has two divisions—Office and Home . The divisions have the following revenues and expenses: Office Home Sales 800,000 900,000 Variable costs (280,000) (200,000) Direct fixed costs (430,000) (320,000) Allocated corporate costs (120,000) (250.000) Net income (loss) (30,000) 130,000 The management at Bash is pondering the elimination of the Office Division. If the Office Division were eliminated, its direct fixed costs could be avoided, but its total corporate costs would not be affected. Given these data, the...
1. The Bash Company has two divisions—Office and Home . The divisions have the following revenues and expenses: Office Home Sales 800,000 900,000 Variable costs (280,000) (200,000) Direct fixed costs (430,000) (320,000) Allocated corporate costs (120,000) (250.000) Net income (loss) (30,000) 130,000 The management at Bash is pondering the elimination of the Office Division. If the Office Division were eliminated, its direct fixed costs could be avoided, but its total corporate costs would not be affected. Given these data, the...