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Answer No.1 letter a and b and also No.2 letter an only Please provide a complete solution

Answer No.1 letter a and b and also No.2 letter an only Please provide a complete solution

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Answer No.1 letter a and b and also No.2 letter an only

Please provide a complete solution

The Frame Division can also sell frames directly to custom home builders, who inl u the glass and hardware at P80.00. The markets for both frames and finished windowS ork perfect competition. Required: 1. Assume that there is no excess capacity in the Frame Division. a. Use the general rule to compute the transfer price for window frames, b. Calculate the transfer price if it is based on standard variable cost with a 10 percent markup of full costs 2. Assume that there is excess capacity in the Frame Division a. Use the general rule to compute the transfer price for window frames. b. Suppose the predetermined fixed overhead rate in the Frame Division is 125 percent of direct labor cost. Calculate the transfer price if it is based on standard full cost plus a 10 percent markup. c. Assume the transfer price established in requirement 2 (b) is used. The Glass Division has been approached by the RP Army Windows at P155. From the perspective of Greystone Corporation as a whole, should the special order be accepted or rejected? Why? d. Assume the same facts as in requirement 2(c). Will an autonomous Glass Division manager accept or reject the special order? Why?
Transcribed Image Text:The Frame Division can also sell frames directly to custom home builders, who inl u the glass and hardware at P80.00. The markets for both frames and finished windowS ork perfect competition. Required: 1. Assume that there is no excess capacity in the Frame Division. a. Use the general rule to compute the transfer price for window frames, b. Calculate the transfer price if it is based on standard variable cost with a 10 percent markup of full costs 2. Assume that there is excess capacity in the Frame Division a. Use the general rule to compute the transfer price for window frames. b. Suppose the predetermined fixed overhead rate in the Frame Division is 125 percent of direct labor cost. Calculate the transfer price if it is based on standard full cost plus a 10 percent markup. c. Assume the transfer price established in requirement 2 (b) is used. The Glass Division has been approached by the RP Army Windows at P155. From the perspective of Greystone Corporation as a whole, should the special order be accepted or rejected? Why? d. Assume the same facts as in requirement 2(c). Will an autonomous Glass Division manager accept or reject the special order? Why?
10.1E Greystone Corporation manufactures windows for the home building industry window frames are produced in the Frame Division. The frames are then transferred he Glass Division, where the glass and hardware are installed. The company's best selling prođua is a three-by-four-foot, double-paned operable-windows. The standard cost of the windowe detailed below: Frame Division Glass Division Direct material P15 P30* Direct labor 20 15 Variable overhead 30 P75 *Not including the transfer price for the frame. 30 Total P65 The Frame Division can also sell frames directly to custom home builders, who install the glass and hardware at P80.00. The markets for both frames and finished windows exhibit perfect competition. Required:
Transcribed Image Text:10.1E Greystone Corporation manufactures windows for the home building industry window frames are produced in the Frame Division. The frames are then transferred he Glass Division, where the glass and hardware are installed. The company's best selling prođua is a three-by-four-foot, double-paned operable-windows. The standard cost of the windowe detailed below: Frame Division Glass Division Direct material P15 P30* Direct labor 20 15 Variable overhead 30 P75 *Not including the transfer price for the frame. 30 Total P65 The Frame Division can also sell frames directly to custom home builders, who install the glass and hardware at P80.00. The markets for both frames and finished windows exhibit perfect competition. Required:
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