How much would the instrument division income

Assignment Help Managerial Accounting
Reference no: EM132529110

Decision on Transfer Pricing

Materials used by the Instrument Division of T_Kong Industries are currently purchased from outside suppliers at a cost of $346 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $287 per unit.

Assume that a transfer price of $329 has been established and that 36,500 units of materials are transferred, with no reduction in the Components Division's current sales.

Question 1: How much would T_Kong Industries' total income from operations increase?

Question 2: How much would the Instrument Division's income from operations increase?

 Question 3: How much would the Components Division's income from operations increase?

Question 14:  Any transfer price will cause the total income of the company to increase , as long as the supplier division capacity is used toward making materials for products that are ultimately sold to the outside.

Reference no: EM132529110

Questions Cloud

Description of new health care business or service line : Description of the new health care business or service line. Definitions of the four areas of the SWOT analysis.
Construct walsh co schedule of cost of goods manufactured : With the results Walsh Co. Reports, prepare T-Account for Work in process for accounting period. Construct Walsh Co. Schedule of Cost of Goods Manufactured
International financial management : What is a multinational corporation? Why do firms expand into other countries?
How much were net cash flows from investing activities : How much were net cash flows from investing activities during 2012 if one plot of land that had been purchased in a prior year for $4,000 was sold
How much would the instrument division income : How much would the Components Division's income from operations increase? How much would the Instrument Division's income
Would be advisable to lease or sell the machinery : Prepare differential analysis, dated May 25 to determine whether Sure-Bilt should lease (Alternative 1) or sell (Alternative 2) the machinery
Gross domestic product : Research information related to the GDP (Gross Domestic Product). This will help you practice using the Internet as a research tool for finding financial inform
What is the unit cost below which forever ready company : What is the unit cost below which Forever Ready Company should not go in bidding on the government contract? Accepting Business at a Special Price
Determine expected average rate of return for each proposal : Determine the expected average rate of return for each proposal. Evaluating two competing capital investment proposals,Average Rate of Return

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Prepare a classified balance sheet for yahoo

Prepare a classified balance sheet for Yahoo! Inc. as of December 31, 2008

  Is a flexible budget always better

Flexible budgets provide different information than static budgets. Discuss some of these differences. Is a flexible budget always better? Are there times when you'd recommend using a static budget over a flexible budget?

  Compute the total cost per mailbox per month

Outsourcing these additional functions would mean that BKFin would not need either an e-mail information technology staff member or the separate virus protection license. Should CEO Wise outsource these extra services to Mail?

  What is the concept of current rate method of translation

What is the concept of current rate method of translation and temporal method of translation? How does balance sheet exposure differ under these two methods?

  Compute the variable unit cost to make one ice maker

Incremental analysis to determine whether the ice makers should be made within the company or purchased from the outside supplier at the higher price.

  Find balance in accumulated depreciation on december?

Define What is the balance in Accumulated Depreciation on December? 31, 2019, if Kornis Corporation uses the double-declining-balance method of? depreciation?

  Name the seven types of events that can trigger an addition

Uniform System of Accounts for the Lodging Industry: Name the seven types of events that can trigger an addition or subtraction from "other comprehensive income

  Should division of rhine autos make or buy the component

Should the Division of Rhine Autos make or buy the component? One of the divisions within Rhine Autos is currently negotiating

  Abc consultants works for only two clients

ABC Consultants works for only two clients: a large, for profit corporation and a small environmental not for profit agency.

  How the article has impacted on the use of ict

INFT6500 Accounting Information Systems - As well as reviewing the article, you must also argue why and how the article has impacted on the use of ICT

  Draw an income statement for the year ended december

Attempt drawing up an income statement for the year ended December 31,2021. (Enter negative amounts using a negative sign or parentheses

  Activity based costing of johnson and johnson

Recognize a product or service in your organization which could use ABC. You can as well use this technique for selling and administrative costs.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd