1. The Selling Division’s unit sales price is P20 and its unit variable cost is P8. Its capacity is 10,000 units. Fixed costs per unit are P4. Current outside sales is 10,000 units. What is the minimum transfer price that the Selling Division would be willing to accept if 3,000 units will be sold to the Purchasing Division? Assume that the Purchasing Division can buy the same from outside market at P18.50. _____________________ 2. The Selling Division’s unit sales price is P20 and its unit variable cost is P8. Its capacity is 10,000 units. Fixed costs per unit are P4. Current outside sales are 7,000 units. What is the Selling Division’s opportunity cost per unit from selling 3,000 units to the Purchasing Division? Assume that the Purchasing Division can buy the same from outside market at P18.50 ______________________ 3. The Selling Division’s unit sales price is P20 and its unit variable cost is P8. Its capacity is 10,000 units. Fixed costs per unit are P4. Current outside sales is 7,500 units. What is the minimum unit transfer price that the Selling Division would be willing to accept if 4,000 units will be sold to the Purchasing Division? Assume that the Purchasing Division can buy the same from outside market at P18.50. ____________________
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
1. The Selling Division’s unit sales price is P20 and its unit variable cost is P8. Its capacity is
10,000 units. Fixed costs per unit are P4. Current outside sales is 10,000 units. What is the
minimum transfer price that the Selling Division would be willing to accept if 3,000 units will
be sold to the Purchasing Division? Assume that the Purchasing Division can buy the same
from outside market at P18.50. _____________________
2. The Selling Division’s unit sales price is P20 and its unit variable cost is P8. Its capacity is
10,000 units. Fixed costs per unit are P4. Current outside sales are 7,000 units. What is the
Selling Division’s opportunity cost per unit from selling 3,000 units to the Purchasing
Division? Assume that the Purchasing Division can buy the same from outside market at
P18.50 ______________________
3. The Selling Division’s unit sales price is P20 and its unit variable cost is P8. Its capacity is
10,000 units. Fixed costs per unit are P4. Current outside sales is 7,500 units. What is the
minimum unit transfer price that the Selling Division would be willing to accept if 4,000 units
will be sold to the Purchasing Division? Assume that the Purchasing Division can buy the
same from outside market at P18.50. _____________________
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