Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

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Answer 1

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Chapter 19, Problem 51P

1.

To determine

Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

2.

To determine

Compute the contribution margin for both divisions for the year ended May 31, 2016 using the market price as the transfer price.

3.

To determine

Mention the price range for toldine that .both the divisions will accept assuming that the consolidated, A will implement the negotiated transfer prices and also state its reason.

4.

To determine

Mention that which of the three forms of transfer rates, i.e., cost-based, market-based, or negotiated, would most likely result in business, A's desirable management actions and thus gain overall company.

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Horngren's Financial & Managerial Accounting: The Managerial Chapters, 8th Edition. E-M:2-19 Accounting for job costs Brook Trailers’ job cost records yielded the following information: Job No. Date Total Cost of Job at July 31 Started Finished Sold 1 21-Jun 16-Jul 17-Jul $ 3,100 2 29-Jun 21-Jul 26-Jul 13,000 3 3-Jul 11-Aug 13-Aug 6,900 4 7-Jul 29-Jul 1-Aug 4,400 Use the dates in the table to identify the status of each job. Compute the following balances for Brook Trailers: a. Work-in-Process Inventory at July 31 b. Finished Goods Inventory at July 31 c. Cost of Goods Sold for July c. COGS $16,100

Donald Diesel owns the Fredonia Barber Shop. He employs 5 barbers and pays each a base salary of $1,380 per month. One of the barbers serves as the manager and receives an extra $535 per month. In addition to the base salary, each barber also receives a commission of $3.75 per haircut. Other costs are as follows. Advertising $270 per month Rent $1,010 per month Barber supplies $0.50 per haircut Utilities $160 per month plus $0.15 per haircut Magazines $35 per month Donald currently charges $11.00 per haircut. Compute the break-even point in sales units and in sales dollars. Break-even point Break-even point sales $ haircuts

Answer 2

Question

Chapter 19, Problem 51P

1.

To determine

Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

2.

To determine

Compute the contribution margin for both divisions for the year ended May 31, 2016 using the market price as the transfer price.

3.

To determine

Mention the price range for toldine that .both the divisions will accept assuming that the consolidated, A will implement the negotiated transfer prices and also state its reason.

4.

To determine

Mention that which of the three forms of transfer rates, i.e., cost-based, market-based, or negotiated, would most likely result in business, A's desirable management actions and thus gain overall company.

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Answer 3

Question

Chapter 19, Problem 51P

1.

To determine

Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

2.

To determine

Compute the contribution margin for both divisions for the year ended May 31, 2016 using the market price as the transfer price.

3.

To determine

Mention the price range for toldine that .both the divisions will accept assuming that the consolidated, A will implement the negotiated transfer prices and also state its reason.

4.

To determine

Mention that which of the three forms of transfer rates, i.e., cost-based, market-based, or negotiated, would most likely result in business, A's desirable management actions and thus gain overall company.

Expert Solution & Answer

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Answer 4

Question

Chapter 19, Problem 51P

1.

To determine

Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

2.

To determine

Compute the contribution margin for both divisions for the year ended May 31, 2016 using the market price as the transfer price.

3.

To determine

Mention the price range for toldine that .both the divisions will accept assuming that the consolidated, A will implement the negotiated transfer prices and also state its reason.

4.

To determine

Mention that which of the three forms of transfer rates, i.e., cost-based, market-based, or negotiated, would most likely result in business, A's desirable management actions and thus gain overall company.

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Answer 5

Chapter 19, Problem 51P

1.

To determine

Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

2.

To determine

Compute the contribution margin for both divisions for the year ended May 31, 2016 using the market price as the transfer price.

3.

To determine

Mention the price range for toldine that .both the divisions will accept assuming that the consolidated, A will implement the negotiated transfer prices and also state its reason.

4.

To determine

Mention that which of the three forms of transfer rates, i.e., cost-based, market-based, or negotiated, would most likely result in business, A's desirable management actions and thus gain overall company.

Answer 6

Chapter 19, Problem 51P

1.

To determine

Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

Answer 7

Chapter 19, Problem 51P

1.

To determine

Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

Answer 8

2.

To determine

Compute the contribution margin for both divisions for the year ended May 31, 2016 using the market price as the transfer price.

Answer 9

2.

To determine

Compute the contribution margin for both divisions for the year ended May 31, 2016 using the market price as the transfer price.

Answer 10

3.

To determine

Mention the price range for toldine that .both the divisions will accept assuming that the consolidated, A will implement the negotiated transfer prices and also state its reason.

Answer 11

3.

To determine

Mention the price range for toldine that .both the divisions will accept assuming that the consolidated, A will implement the negotiated transfer prices and also state its reason.

Answer 12

4.

To determine

Mention that which of the three forms of transfer rates, i.e., cost-based, market-based, or negotiated, would most likely result in business, A's desirable management actions and thus gain overall company.

Answer 13

4.

To determine

Mention that which of the three forms of transfer rates, i.e., cost-based, market-based, or negotiated, would most likely result in business, A's desirable management actions and thus gain overall company.

Answer 14

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Answer 15

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Answer 16

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Answer 17

Ch. 19 - Prob. 1Q Ch. 19 - What is return on investment (ROI), and how is it...Ch. 19 - What are the measurement issues to consider when...Ch. 19 - What are the advantages and limitations of return...Ch. 19 - What are the components of return on investment...Ch. 19 - What are the advantages and limitations of...Ch. 19 - Prob. 7Q Ch. 19 - Prob. 8Q Ch. 19 - What is meant by the term arm’s length standard,...Ch. 19 - What does expropriation mean, and what is the role...

Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

Mention that whether the transfer prices based on cost will be appropriate as a divisional performance measure and explain its reason.

Compute the contribution margin for both divisions for the year ended May 31, 2016 using the market price as the transfer price.

Mention the price range for toldine that .both the divisions will accept assuming that the consolidated, A will implement the negotiated transfer prices and also state its reason.

Mention that which of the three forms of transfer rates, i.e., cost-based, market-based, or negotiated, would most likely result in business, A's desirable management actions and thus gain overall company.

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