Required: Assume that the Pump Division has enough Idle capacity to handle all of the Pool Products Division's needs. What is the acceptable ange, If any, for the transfer price between the two divisions? Note: Round your answers to 1 decimal place.
Required: Assume that the Pump Division has enough Idle capacity to handle all of the Pool Products Division's needs. What is the acceptable ange, If any, for the transfer price between the two divisions? Note: Round your answers to 1 decimal place.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:Zumsteg Products, Incorporated, has a Pump Division that manufactures and sells a number of products, including a standard pump.
Date concerning that pump appear below:
Capacity in units
Selling price to outside customers
Variable cost per unit
Fixed cost per unit (based on capacity)
72,800
#106
70.0
$20
The company has a Pool Products Division that could use this pump in one of its products. The Pool Products Division is currently
purchasing 8,800 of these pumps per year from an overseas supplier at a cost of $99 per pump.
Required:
Assume that the Pump Division has enough Idle capacity to handle all of the Pool Products Division's needs. What is the acceptable
ange, If any, for the transfer price between the two divisions?
Note: Round your answers to 1 decimal place.
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