When The division is operating at capacity, then in such case minimum transfer is equal to the selling Price in the outside market.
Therefore,
Minimum Transfer Price = Selling price = $66
Therefore, option "B" is correct
Paden Company has a division that manufactures a component that sells for $66 and has variable...
paden company has a division that manufactures a component that sells for $52 and has variable costs of $15 and fixed costs of $19. another division wants to purchase the component. what is the minimum transfer price if the division is operating at capacity? a. $19 b. $15 c. $34 d. $52
1.
2.
Raven, Inc. has a division that manufactures a component that sells for $195 and has a variable cost of $45. Another division of the company wants to purchase the component. Fixed cost per unit of the component is $21. What is the minimum transfer price if the division is operating below its capacity? XA. $195 *B. $45 O C. $66 OD. $21 Governments often have the potential to influence whether firms are monopolies. How might the government affect...
The Wood Division of Concord Corporation manufactures rubber moldings and sells them externally for $45. Its variable cost is $25 per unit, and its fixed cost per unit is $8. Concord’s president wants the Wood Division to transfer 4000 units to another company division at a price of $24. Assuming the Wood Division does not have any available capacity, the minimum transfer price it should accept is=== $8. $45. $25. $24.
Henderson Company manufactures electronics. The Calculator Division (an investment center) manufactures handheld calculators. The division can purchase the batteries used in the calculators from the Battery Division (another investment center) or from an outside vendor. The cost to purchase batteries from the outside vendor is $5. The transfer price to purchase from the Battery Division is $6. The Battery Division also sells to outside customers. The sales price is $6, and the variable cost is $3. The Battery Division has...
Henderson Company manufactures electronics. The Calculator Division (an investment center) manufactures handheld calculators. The division can purchase the batteries used in the calculators from the Battery Division (another investment center) or from an outside vendor. The cost to purchase batteries from the outside vendor is $5. The transfer price to purchase from the Battery Division is $6. The Battery Division also sells to outside customers. The sales price is $6, and the variable cost is $3. The Battery Division has...
The Can Division of Bonita Industries manufactures and sells tin cans externally for $1.20 per can. Its unit variable costs and unit fixed costs are $0.24 and $0.10, respectively. The Packaging Division wants to purchase 50,000 cans at $0.34 a can. Selling internally will save $0.03 a can. Assuming the Can Division has sufficient capacity, what is the minimum transfer price it should accept?
Stable Company manufactures power tools. The Electric Drill Division (an investment center) can purchase the motors for the drills from the Motor Division (another investment center) or from an outside vendor. The cost to purchase from the outside vendor is $26. The Motor Division also sells to outside customers. The motor needed by the Electric Drill Division sells for $32 to outside customers and has a variable cost of $23. The Motor Division has excess capacity. 21. 22. If Stable...
Germano Products, Inc., has a Pump Division that manufactures and sells a number of products, including a standard pump that could be used by another division in the company, the Pool Products Division, in one of its products. Data concerning that pump appear below: Capacity in units Selling price to outside customers Variable cost per unit Fixed cost per unit (based on capacity) 87,500 $ 91 $ 32 $ 38 The Pool Products Division is currently purchasing 23,000 of these...
McFarlane Company has two divisions, Division C and Division D.
Division C manufactures Part C82 and sells it to Division D, and
also sells the same part to the outside market for $73 per unit.
Division C has capacity to make
1,200,000 units of C82 per year. The division's fixed costs are
$ 6,500,000 per year and its variable costs per unit are as
follows:
Part C82 is an essential component for Division D's only
product; the division sells 550,000...
Do It! Review 8-4 The fastener division of Southern Fasteners manufactures zippers and then sells them to customers for $7.72 per unit. Its variable cost is $3.47 per unit, and its fixed cost per unit is $1.49. Management would like the fastener division to transfer 12,100 of these zippers to another division within the company at a price of $3.47. The fastener division could avoid $0.31 per zipper of variable packaging costs by selling internally. Determine the minimum transfer price....