Swifty Corporation manufactures and sells high-priced motorcycles. The Engine Division produces and sells engines to othermotorcycle companies and internally to the Production Division. It has been decided that the Engine Division will sell 23000units to the Production Division at 1050 a unit. The Engine Division, currently operating at capacity, has a unit sales price of$2650 and unit variable costs and fixed costs of $1050 and $1600, respectively. The Production Division is currently paying$2500 per unit to an outside supplier. $110 per unit can be saved on internal sales from reduced selling expenses.What is the minimum transfer price that the Engine Division should accept?$1600$2500$2540$2650

When assets, products, or services are moved between affiliated companies within a corporate group…

Swifty Corporation manufactures and sells high-priced motorcycles. The Engine Division p motorcycle companies and internally to the Production Division. It has been decided that t units to the Production Division at 1050 a unit. The Engine Division, currently operating at $2650 and unit variable costs and fixed costs of $1050 and $1600, respectively. The Produ $2500 per unit to an outside supplier. $110 per unit can be saved on internal sales from re

Swifty Corporation manufactures and sells high-priced motorcycles. The Engine Division p motorcycle companies and internally to the Production Division. It has been decided that t units to the Production Division at 1050 a unit. The Engine Division, currently operating at $2650 and unit variable costs and fixed costs of $1050 and $1600, respectively. The Produ $2500 per unit to an outside supplier. $110 per unit can be saved on internal sales from re

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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Tuttle Motorcycles Inc. manufactures and sells high-priced motorcycles. The Engine Division produces and sells engines to other motorcycle companies and internally to the Production Division. It has been decided that the Engine Division will sell 30,000 units to the Production Division. The Engine Division, currently operating at capacity, has a unit sales price of P1,800 and unit variable costs and fixed costs of P700 and P500, respectively. The Production Division is currently paying P1,600 per unit to an outside supplier. P180 per unit can be saved on internal sales from reduced selling expenses.14. What is the minimum transfer price that the Engine Division should accept? ______________15. What is the increase/decrease in overall company profits if this transfer takes place? ______________16. If Engine Division has enough excess capacity to provide the requirement of Production Division, what is the minimum transfer price that the Engine Division should accept? ______________17.…
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Tuttle Motorcycles Inc. manufactures and sells high-priced motorcycles. The Engine Division produces and sells engines to other motorcycle companies and internally to the Production Division. It has been decided that the Engine Division will sell 20,000 units to the Production Division at $1,050 a unit. The Engine Division, currently operating at capacity, has a unit sales price of $2,550 and unit variable costs and fixed costs of $1,050 and $750, respectively. The Production Division is currently paying $2,400 per unit to an outside supplier. What is the minimum transfer price that the Engine Division should accept? (Round your answer to a whole number if needed. Just put the number in the blank. No $ sign.) 2,460
manufactures and sells high-priced motorcycles. The Engine Division produces and sells engines to other motorcycle companies and internally to the Production Division. It has been decided that the Engine Division will sell 20,000 units to the Production Division at P700 a unit. The Engine Division, currently operating at capacity, has a unit sales price of P1,700 and unit variable costs and fixed costs of P700 and P500, respectively. The Production Division is currently paying P1,600 per unit to an outside supplier. P60 per unit can be saved on internal sales from reduced selling expenses.What is the increase/(decrease) in overall company profits if this transfer takes place?
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