Flash E Card Manufacturing manufactures software parts for the computer software systems that produce e -cards. The Flash II part is currently manufactured in the Computer Department. The Data Department also produces the part and the plant has excesscapacity to produce the Flash ll part. The current market price of the Flash Il part is $500. The managerial accountant reported the following manufacturing costs and variable expense data:Flash E-Card ManufacturingManufacturing Costs and Variable Expense ReportFlash ComponentDirect materials$800$170Direct labor$110Variable manufacturing overheadFixed manufacturing overhead (current production level)Variable selling expenses (only incurred on sales to outside consumers)$125$140If the highest acceptable transfer price is $500 in the market, what is the lowest acceptable in house price the Data Department should receive to produce the part in house at the Computer Department?O A. $1,080О В. $800О С. $170O D. $110

Calculation of lowest acceptable in-house price:

Answered: Flash E Card Manufacturing manufactures…

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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