Riverbed Company's Small Motor Division manufactures a number of small motors used in household and office appliances. The Household Division of Riverbed then assembles and packages such items as blenders and juicers. Both divisions are free to buy and sell any of their components internally or externally. The following costs relate to small motor LN233 on a per unit basis. Unit fixed cost Unit variable cost Unit selling price $5 11 31 Assuming that the Small Motor Division has excess capacity, compute the minimum acceptable price for the transfer of small motor LN233 to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.) Minimum transfer price per unit

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Question

sd

subject-Accounting

Riverbed Company's Small Motor Division manufactures a number of small motors used in household and office appliances. The
Household Division of Riverbed then assembles and packages such items as blenders and juicers. Both divisions are free to buy and
sell any of their components internally or externally. The following costs relate to small motor LN233 on a per unit basis.
Unit fixed cost
Unit variable cost
Unit selling price
$5
11
31
Assuming that the Small Motor Division has excess capacity, compute the minimum acceptable price for the transfer of small
motor LN233 to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.)
Minimum transfer price $
per unit
Transcribed Image Text:Riverbed Company's Small Motor Division manufactures a number of small motors used in household and office appliances. The Household Division of Riverbed then assembles and packages such items as blenders and juicers. Both divisions are free to buy and sell any of their components internally or externally. The following costs relate to small motor LN233 on a per unit basis. Unit fixed cost Unit variable cost Unit selling price $5 11 31 Assuming that the Small Motor Division has excess capacity, compute the minimum acceptable price for the transfer of small motor LN233 to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.) Minimum transfer price $ per unit
Assuming that the Small Motor Division has excess capacity, compute the minimum acceptable price for the transfer of small
motor LN233 to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.)
Minimum transfer price $
eTextbook and Media
per unit
Assuming that the Small Motor Division does not have excess capacity, compute the minimum acceptable price for the transfer of
the small motor to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.)
Minimum transfer price $
Transcribed Image Text:Assuming that the Small Motor Division has excess capacity, compute the minimum acceptable price for the transfer of small motor LN233 to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.) Minimum transfer price $ eTextbook and Media per unit Assuming that the Small Motor Division does not have excess capacity, compute the minimum acceptable price for the transfer of the small motor to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.) Minimum transfer price $
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