Please provide the Transfer Pricing Schedule/Policy under the Optimum Transfer Pricing Method for the attached problem. Ute Semi-Conductor CompanyProblem #2Ute Semi-conductorsuperchipssuperchipsExternalmarketSuperchipVariable cost$170Selling price$500Market Demand10,000Hours/unit to produce3Max 30KUte Mini-computerProduction capacity of semi-conductor = 90,000 hoursUte has a 100% owned subsidiary (Ute Mini-Computer) that wants topurchase super chips. What should Ute establish as the Transfer PricePolicy under the Optimum Transfer Pricing method?3

1] Opportunity CostThe variable cost + opportunity cost is usually the transfer price under the best…

Answered: Ute Semi-Conductor Company Problem #2…

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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a company audio division produces a speaker that is used by manufactureers of various audio products Sales and cost data on the speaker follow Selling price per unit 120 varioable cost per unit 102 Fixed costs per unit $8 Capacity in units 25,000 Assume the dvision is selling 22500 speakers per year tocusotmers a) what is the lowest acceptable transfer price b) what is highest accepatbale transfer price What is the range of acceptable transfer prices between 2 division If left free to negotiate without interference would you expect divison managers to voluntaily agree to transfer 5000 speakers fromthe Audio divison to Hi Fi? why or why not From the standpoint of the entire company should the transfer take place why or why not?
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Kimmel, Accounting, 7e Help | System Announcements CALCULATOR PRINTER VERSION 1 BACK NEXT Exercise 21-16 Crede Inc. has two divisions. Division A makes and sells student desks. Division B manufactures and sells reading lamps. Each desk has a reading lamp as one of its components. Division A can purchase reading lamps at a cost of $11 from an outside vendor. Division A needs 9,300 lamps for the coming year. Division B has the capacity to manufacture 46,700 lamps annually. Sales to outside customers are estimated at 37,400 lamps for the next year. Reading lamps are sold at $11 each. Variable costs are $7 per lamp and include $1 of variable sales costs that are not incurred if lamps are sold internally to Division A. The total amount of fixed costs for Division B is $72,300. Consider the following independent situations. What should be the minimum transfer price accepted by Division B for the 9,300 lamps and the maximum transfer price paid by Division A? Minimum transfer price accepted by…
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Flounder Tech produces 60000 iPhone adapters with the following costs: Direct Materials $13000 Direct Labor 11000 Variable Overhead 3000 Fixed Overhead 12000 None of Flounder's fixed overhead costs can be reduced, but another product could be made that would increase profit by $6900 if the adapters were acquired externally. If cost minimization is the major consideration and the company would prefer to buy the adapters, what is the maximum external price that Flounder would be willing to accept to acquire the 60000 units externally? O $33900 $32100 O $45900 ○ $39000

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