The Can Division of Crane Company manufactures and sells tin cans externally for $0.70 per can. Its unit variable costs and unit fixed costs are $0.24 and $0.07, respectively. The Packaging Division wants to purchase 50,000 cans at $0.31 a can. Selling internally will save $0.05 a can. Assuming the Can Division is already operating at full capacity, what is the minimum transfer price it should accept? $0.67 $0.39 $0.36 $0.65

Q: BBB Company has capacity to produce 150,000 units a year and sell it for $96 each. The costs of…

A: Given that: Number of units = 150,000 units Selling price per unit = $96 per unit

Q: Viking Corporation’s variable cost per unit produced is $100. Wholesaler Y offers to buy 2,000…

A: Special order are those orders that are not frequent in nature. They are orders placed rarely by…

Q: The Great Fish Taco Corporation currently has fixed operating costs of $15,000, sells its pre-made…

A: Breakeven point is the number of boxes to be sold so that the company incurs no profit nor loss.…

Q: The Can Division of Concord Corporation manufactures and sells tin cans externally for $ 0.70 per…

A: Formula: Minimum transfer price = Unit variable cost - Selling internally will save  cost

Q: Jasmine Incorporated sells a product for $61 per unit. Variable costs per unit are $31, and fixed…

A: Break Even Point - It Is The Point Of Production Where Total Costs Is Equal To Total Revenue. At…

Q: Peppertree Company has two divisions, East and West. Division East manufactures a component that…

A: Cost: The amount paid to purchase the asset, install it, and put it into operations, is referred to…

Q: Perez Electronics currently produces the shipping containers it uses to deliver the electronics…

A: a. Total relevant cost = Unit-level materials + Unit-level labor + Unit-level overhead +…

Q: The EKTA’s main competitor does not manufacture their bicycle frames. They purchase the frames from…

A: The manufacturing cost is the cost of converting raw material into finished goods. It includes the…

Q: Swan Company has two divisions, Hill and Paradise. Hil 5,600 units from an outside supplier for $62.…

A: Solution: Paradise will save = Outside purchase price - Transfer price  = 62 - 48 = $14 per unit

Q: Braizen, Inc. produces a product with a $30 per-unit variable cost and an $80 per-unit sales price.…

A: CVP analysis is considered a decision-making tool that helps management to make strategies and take…

Q: Ignite Products is a price-taker. The company produces large spools of electrical wire in a highly…

A: Desired profit :— It is the calculated by multiplying amount of investment by % return  on…

Q: Pimpton Plows sells its product for $50. Its variable cost per unit is $19.00. Fixed costs total…

A: Calculate the break even point as follows: Break even units = Fixed cost / (Selling price - variable…

Q: available related to each product: Small Large Sales price per unit $650 $900 Variable costs per…

A: Answer 5.1) Calculation of Break even sales in units:::: Contribution margin per Unit=Sales price…

Q: Baird Electronics currently produces the shipping containers it uses to deliver the electronics…

A: a. Total relevant cost = Material + Labor + overhead + Product level cost =6500+6400+4100+9600*1/3 =…

Q: Company E has two divisions, Division A and Division B. Division A is currently buying Component X…

A: When the transfer price is based on the full cost based, then Transfer price can be calculated by…

Q: The marketing manager of Perez Corporation has determined that a market exists for a telephone with…

A: Variable cost per unit is the per unit value incurred on the making of the goods which is variable…

Q: Hu Corporation has two operating divisions, A and B. The following information is provided for…

A: Note: As per general rule, in the case of sufficient capacity available, the minimum transfer price…

Q: Holiday Corp. has two divisions, Quail and Marlin. Quail produces a widget that Marlin could use in…

A: Full cost of $7.10 is irrelevant cost because the production in excess capacity will only incur…

Q: Sheffield, Inc. is unsure of whether to sell its product assembled or unassembled. The unit cost of…

A: Further Process Decision :— Product is produced further when increamental profit from further…

Q: Nguyen Electronics wants to add solid state whoozits (SSW's) to its product line. Adding SSW's to…

A: Formula: Break even market share = Break even Dollar sales / Total market worth. Division of Total…

Q: Wheeler Company can produce a product that incurs the following costs per unit: direct materials,…

A: Compute the total cost in making the product and total cost in buying the buying the product. If the…

Q: The Forth Company's Western Division has capacity of 200,000 units. Norm selling price is £30.00 per…

A: Lets understand the basics.When transfer is made between the two departments of the company the…

Q: Hazel Company makes an unassembled product that it currently sells for $55. Production costs are…

A: Incremental Analysis :— This analysis shows the comparison between two different alternatives. A…

Q: Halifax Products sells a product for $75. Variable costs per unit are $50, and monthly fixed costs…

A: Breakeven is the point at which the entity is in a situation of no profit and no loss. At this…

Q: Vernon Electronics currently produces the shipping containers it uses to deliver the electronics…

A: Buy cost is the cost of purchasing the product from outside.Make cost is the cost of making/…

Q: The Wood Division of Swifty Corporation manufactures rubber moldings and sells them externally for…

A: CVP analysis is considered a decision-making tool that helps management to make strategies and take…

Q: The marketing manager of Jordan Corporation has determined that a market exists for a telephone with…

A: MARGINAL COSTING INCOME STATEMENTMarginal Costing Income Statement is One of the Important Cost…

Q: Swifty Corporation is planning to sell 810000 units for $1.50 per unit. The contribution margin…

A: Break-Even Sales: Sales volume required to cover the fixed and variable costs and left out with…

Q: Holiday Corporation has two divisions, Quail and Marlin. Quail produces a widget that Marlin could…

A: Introduction:-   This question deals with the concept of transfer pricing, which is the pricing…

Q: Finch Electronics currently produces the shipping containers it uses to deliver the electronics…

A: When choosing whether to create a product domestically or purchase it from a third party, a…

Q: he Mighty Music Company produces and sells a desktop speaker for $200. The company has the capacity…

A: If a company is faced with a special order and the selling price for the order is the same as the…

Q: CB76 at a cost of $220 each. Variable cost If Douglas buys from Peach it will be able t ffer?…

A: Relevant Cost: Relevant cost is the avoidable cost which is incurred at the time of the decision…

Q: The Slate Company manufactures and sells television sets. Its assembly division (AD) buys television…

A:

Q: Daily Kneads, Inc., is considering outsourcing one of its many products rather than making it…

A: Make or Buy Decision: The process of deciding whether to produce a product or service in-house or to…

Q: he Wood Division of Sheridan Company manufactures rubber moldings and sells them externally for $55.…

A: Internal transfer means where one independent department is transferring the goods to another…

Q: The Chimes Clock Company sells a particular clock for $40. The variable costs are $23 per clock and…

A: Lets understand the basicsVariable costs are costs which changes with change in activity…

Q: Company E has two divisions, Division A and Division B. Division A is currently buying Component X…

A: Division A has excess capacity therefore there will be no opportunity cost. The cost-based transfer…

Q: Company E has two divisions, Division A and Division B. Division A is currently buying Component X…

A: Total cost=Variable cost + Fixed cost

Q: The Can Division of Sheffield Corp. manufactures and sells recyclable containers externally for…

A: Transfer price is synonymous with transfer cost. It refers to the price at which related parties…

Q: You are selling a new line of T-shirts on the boardwalk. The selling price will be $25 per shirt.…

A: Break even point in units = Fixed costs / contribution margin per unit  Break even point in sales…

Q: Peppertree Company has two divisions, East and West. Division East manufactures a component that…

A: If East division has excess capacity, the lowest price the east division will accept is to recover…

Q: Management of the Crane Company would like the Food Division to transfer 11000 cans of its final…

A: The minimum transfer price is equivalent to the marginal cost of manufacturing one product. The…

Q: Glide Behind Corporation manufactures and sells small cargo trailers. The Wheel Division creates…

A: Variable costs are costs that varies with the change in the level of output whereas fixed costs are…

Q: Concord, Inc. is unsure of whether to sell its product assembled or unassembled. The unit cost of…

A: Given information, •Un-assembled product: Cost= $13 Selling price= $54   •Assembled product:…

Q: Company E has two divisions, Division A and Division B. Division A is currently buying Component X…

A: Full cost transfer  price  = variable cost + fixed costs

Q: Answer the following questions. Required 1. Deibler Computers makes 5,600 units of a circuit board,…

A: Variable cost per unit is the extra expense incurred when producing or offering a product or service…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.