Timekeeper Corporation has two divisions, Distribution and Manufacturing. The company's primary product is highminus−end watches. Each division's costs are provided below: Manufacturing: Variable costs per unit $1.95 Fixed costs per unit $8.17 Distribution: Variable costs per unit $1.10 Fixed costs per unit $1.00 The Distribution Division has been operating at a capacity of 4,007,000 units a week and usually purchases 2,003,500 units from the Manufacturing Division and 2,003,500 units from other suppliers at $16.00 per unit. What is the transfer price per watch from the Manufacturing Division to the Distribution Division, assuming the method used to place a value on each watch is 160% of variable costs? (Round the answer to the nearest cent.)
Timekeeper Corporation has two divisions, Distribution and Manufacturing. The company's primary product is highminus−end watches. Each division's costs are provided below: Manufacturing: Variable costs per unit $1.95 Fixed costs per unit $8.17 Distribution: Variable costs per unit $1.10 Fixed costs per unit $1.00 The Distribution Division has been operating at a capacity of 4,007,000 units a week and usually purchases 2,003,500 units from the Manufacturing Division and 2,003,500 units from other suppliers at $16.00 per unit. What is the transfer price per watch from the Manufacturing Division to the Distribution Division, assuming the method used to place a value on each watch is 160% of variable costs? (Round the answer to the nearest cent.)
Chapter5: Process Costing
Section: Chapter Questions
Problem 1PA: The following product Costs are available for Haworth Company on the production of chairs: direct...
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Timekeeper Corporation has two divisions, Distribution and Manufacturing. The company's primary product is
highminus−end
watches. Each division's costs are provided below: Manufacturing: Variable costs per unit $1.95
Fixed costs per unit $8.17
Distribution: Variable costs per unit $1.10
Fixed costs per unit $1.00
The Distribution Division has been operating at a capacity of 4,007,000 units a week and usually purchases 2,003,500 units from the Manufacturing Division and 2,003,500 units from other suppliers at $16.00 per unit.
What is the transfer price per watch from the Manufacturing Division to the Distribution Division, assuming the method used to place a value on each watch is 160% of variable costs? (Round the answer to the nearest cent.)
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