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Smith-jones Company a US based corporation, owns 100 percent of Joal SA, located in Guadalajara, Mexico. Joal manufactures premium leather hand bags at a cost of 500 Mexican pesos each. Joal sells its handbags to SMith-Jones, which sells them under Joal's brand name in its retail stores in the United States. Joal all sells handbags to an uncontrolled wholesaler in the United States. Joal invoices all sales to US customers in US dollars. Because the customer is not allowed dto use Joal's brand name, it affixes its own label to the handbags and sells them to retailers at a markup on cost of 30%. Other US retailers import premium leather handbags from uncontrolled suppliers in Italy, making payment in euros, and sell them to generate fross profit margins equal to 25 percent of selling price. Imported Italian leather handbags are of similar quality to those produced by Joal. Bolsa SA also produces handbags in Mexico and sells them directly to Mexican retailers earning a gross profit equal to 60 percent of production cost. Thus, Bolsa's handbags are of lesser quality than Joal's due to the use of a less complex manufacturing process, and the two companies' handbags do not compete openly. Required: a. Provide the facts presented, show the various factors that affect reliability of (1) the comparable uncontrolled price method, (2) the resale price technique, (3) the cost plus technique. b. Choose the method from those listed in (a) that you believe is best, and explain any adjustments that might be necessary to prepare a more reliable transfer price.
Potential investor and could only review one financial statement of a company in which you would like to buy stock, which financial statement would you choose and why? Be specific with your answer and provide about 250 words.
An examination of the accounting records of a fictitious business, the Clowney Company, disclosed a high contribution margin ratio and production at a level below maximum capacity.
Prepare an income statement for 2010 and prepare a statement of retained earnings for 2010
How many units did Integrated Corporation sell?
Sara Douglas purchased 30 shares of WXY stock for $210, and on October 29, 2013, she purchased 90 additional shares for $900. On November 28, 2013, she sold 48 shares, which could not be specifically identified, for $480, and on December 8, 2013.
questionarcher daniels midland company is considering buying a fresh farm that it plans to operate for 10 years. the
Purpose a schedule showing the determination of goodwill,
Using the net present value method to evaluate this capital investment, determine whether the company should purchase the machine. Support your answer.
Top Sail Company produces one type of machine with the following costs and revenues for year. Total Revenues: 5,600,000 What is the selling price per unit What is the variable cost per unit What is the contribution margin What is the break-even point..
Determine what affect a sales volume increase or decrease will have on unit fixed cost, unit variable cost, total fixed cost, and total variable cost.
Evaluated warranty costs are expensed for accounting purposes when incurred. depreciation for accounting and income tax purposes differs because of dissimilar bases of carrying the related property.
Evaluate the maximum depreciation expense
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