The minimum transfer price for a selling division with excess capacity to accommodate the transfer of produced units to the buying division is usually based on the
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The minimum transfer price for a selling division with excess capacity to accommodate the transfer of produced units to the buying division is usually based on the
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- Break-even analysis attempts to determine the volume of sales necessary for a manufacturer to cover costs, or to make revenue equal costs. It is helpful in setting prices, estimating profit or loss potentials, and determining the discretionary costs that should be incurred. The general formula for calculating break-even units is: Total Fixed Costs Break-even Units = Unit Selling Price-Unit Variable Cost In StratSim, total fixed costs can be broken into discretionary marketing expenditures, and fixed costs for plant and overhead. The selling price is the MSRP less the dealer discount, and the cost of materials and labor make up the variable cost. In this assignment, you will allocate fixed costs across a portfolio of products and calculate the break-even units for each product. A firm's production capacity is 1.5 million units, with annual fixed costs of $3.2 billion for depreciation, plant maintenance, corporate marketing, and general overhead. Additional values for the three vehicles…Which of the following is true of a company that uses absorption costing? Multiple Choice Net operating income fluctuates directly with changes in sales volume. Fixed production and fixed selling costs are considered to be product costs. Unit product costs can change as a result of changes in the number of units manufactured. Variable selling expenses are included in product costs.When the Selling Division can fill all its regular orders and has enough capacity to supply the Purchasing Division, what is the highest transfer price the Purchasing Division would be willing to pay? O Variable cost of producing and selling a unit of product. The Purchasing Division's regular purchase price from its external supplier. The full absorption cost of producing a unit of product. O The market price charged to regular customers less any costs saved by transferring internally.
- Break-even analysis attempts to determine the volume of sales necessary for a manufacturer to cover costs, or to make revenue equal costs. It is helpful in setting prices, estimating profit or loss potentials, and determining the discretionary costs that should be incurred. The general formula for calculating break-even units is: Total Fixed Costs Break-even Units = Unit Selling Price-Unit Variable Cost In StratSim, total fixed costs can be broken into discretionary marketing expenditures, and fixed costs for plant and overhead. The selling price is the MSRP less the dealer discount, and the cost of materials and labor make up the variable cost. In this assignment, you will allocate fixed costs across a portfolio of products and calculate the break-even units for each product. A firm's production capacity is 1.5 million units, with annual fixed costs of $3.2 billion for depreciation, plant maintenance, corporate marketing, and general overhead. Additional values for the three vehicles…Which of the following is true of a company that uses absorption costing? Net operating income fluctuates directly with changes in sales volume. Fixed production and fixed selling costs are considered to be product costs. Unit product costs can change as a result of changes in the number of units manufactured. Variable selling expenses are included in product costs.When the selling division is a full capacity, the goal congruent transfer price will be the: market price actual full cost actual variable cost standard full cost actual variable cost plus markup
- Assume you are the department B manager for Marleys Manufacturing. Marleys operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only o department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation. (Hint: It may be helpful to perform a vertical analysis.)For which cost concept used in applying (he cost-plus, approach to product pricing are fixed manufacturing costs, fixed selling and administrative expenses, and desired profit allowed for in determining the markup? A. Total cost B. Product cost C. Variable cost D. Standard costBreak-even for a multiple product firm. can be calculated by dividing total fixed costs by the contribution margin of a composite unit can be calculated by multiplying fixed costs by the contribution margin ratio of a composite unit can only be calculated when the proportion of products sold is the same for all products can be calculated by multiplying fixed costs by the contribution margin ratio of the most common product in the sales mix
- Contribution margin by segment The following information is for LaPlanche Industries Inc.: Determine the contribution margin for (A) Product YY and (B) West Region.If the minimum transfer price of the selling division is less than the maximum transfer price of the buying division, the intermediate product should be transferred internally. Do you agree or disagree? Why?Question Content Area The approach that requires the transfer price to be less than the market price but greater than the supplying division's variable costs per unit is called the _____ approach. a.negotiated cost b.cost price c.standard cost d.market price