--/1Question 15esView PoliciestionsCurrent Attempt in ProgressUS SupportThe Heating Division of Kobe International produces a heatingelement that it sells to its customers for $44 per unit. Its variablecost per unit is $25, and its fixed cost per unit is $12. Topmanagement of Kobe International would like the Heating Divisionto transfer 14,600 heating units to another division within thecompany at a price of $30. The Heating Division is operating at fullcapacity. What is the minimum transfer price that the HeatingDivision should accept?tral65Minimum transfer price$8:48 PM49)11/18/2019Chpfofninsprt scf124homedeleteendpg up9numbackspacelock78

Calculate the opportunity cost (contribution margin).

Answered: --/1 Question 15 es View Policies tions…

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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Question 9.4 East Meets West Ltd. is a Canadian company with a fully owned subsidiary in the UK. The UK subsidiary produces a component for off shore gas compressors that are sold in Canada. The components have a variable cost of 1,700 Euros and a full cost of 2,100 Euros. The 2,000 components required can be purchased in Canada for $3,500. Assume the minimum transfer price allowed by the Canadian tax authorities is the variable cost and the maximum is the market value. Also assume operating income in each country is equal to taxable income. One Euro is worth $1.45 Canadian. The marginal tax rate in Canada is 25% and in Ireland 12.5%. Required: What transfer price should be set for East Meets West Ltd. to minimize its total income taxes? Show your calculations. If East Meets West Ltd. desires to minimize its total income taxes, calculate the amount of tax liability in each country in Canadian dollars.
Q25
Question 45 Assume a division of HP Inc currently makes 50,000 circuit boards per year used in producing diagnostic electronic instruments at the cost of 150 per board, considering of variable costs per unit of $35 and feed costs per unit of $15. Further, assume Sarmina Corporation offers to sell HP the 50.000 circuit boards for $50 each if HP accepts this offer the facilities currently used to make the boards could be rented to one of HP's suppliers for $75,000 per year. In addition, $8 per unit of the fixed overhead applied to the circuit boards would be totally eliminated. Should HP outsource this component from Sanmina Corporation Support your answer with relevant cost calculations. Make-or-Buy) Decision.
Oman ceramics company SAOG manufacture high quality vitreous china sanitary ware in Oman. It is presently operating at 80% capacity, the company’s repairs and maintenance cost is estimated as OMR 80,000 (30% fixed ), if the company operates at 90% capacity, how much the variable cost the company should spend for repairs and maintenance? a. OMR 56,000 b. OMR 50,000 c. None of these d. OMR 63,000
6
Return to question Lost Mine has offered to buy 3,100 of the US umbrellas at a price of $32 each. Mohave currently has the excess capacity necessary to accept the offer. The following information is related to the production of the US umbrella: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost $13.00 7.00 9.00 2.50 $31.50 $40.00 Regular. sales price Required: 1. Compute the incremental profit (or loss) from accepting the special order. 2. Should Mohave accept the special order? 3. Suppose that the special order had been to purchase 3,600 umbrellas får $28.00 each. Recompute the incremental profit (or loss) from accepting the special order under this scenario. 4. Assume that Mohave is operating at full capacity. Calculate the special-order price per unit at which Mohave would be indifferent between accepting or rejecting the special order. X Answer is complete but not entirely correct. Complete this question by entering your answers in…
a1
Q.23 HM motors is considering eliminating its mountain bike division, which reported an operating loss for the recent year of P3,000. The division sales for the year = P1,050,000, variable costs = P860,000 Fixed costs of the division =P193,000 If the mountain bike division is dropped, 30% of the fixed costs allocated to that division could be eliminated. The impact on operating income for eliminating this business segment would be: a.57,900 decrease b.132,100 decrease c.54,900 decrease d.190,000 increase
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Show complete Solution Choices a. 1768 b. 884 c. 205 d. 145 Choices for item 1.2 a. 50% b. 84.55% c. 93.64% d. 97.22%
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