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HACTEHA [7]
3 years ago
12

Materials used by Jefferson Company in producing Division C's product are currently purchased from outside suppliers at a cost o

f $10.00 per unit. However, the same materials are available with Division A. Division A has unused capacity and can produce the materials needed by Division C at a variable cost of $8.50 per unit. A transfer price of $9.50 per unit is negotiated and 25,000 units of material are transferred, with no reduction in Division A's current sales. How much will Division A's income from operations increase? a. $50,000 b. $25,000 c. $0 d. $75,000
Business
2 answers:
My name is Ann [436]3 years ago
5 0

Answer:

b.25,000

Explanation:

Saving cost per unit = Transfer price per unit - variable cost per unit

                                 = $9.50 - $8.50

                                 = $1.00 per unit

Thus, saving cost per unit is $1.00 per unit

Now multiply this saving cost per unit with transferred units to interpret how much amount is increased

= $1.00 × 25,000 units

= $25,000

The supplier cost is irrelevant for computation.

AVprozaik [17]3 years ago
4 0

Answer:

None of the above.

Total Income from operation increase.  12,500.00

Explanation:

  • Purchase cost from outside

$          10.00 Per unit

  • Inter transfer purchase from Division A

$            9.50 Per unit

  • Saving Per unit

$            0.50 Per unit

  • Number of units purchased from Division A

25.000 Units

Total Income from operation increases      12,500.00

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aleksandr82 [10.1K]

Answer: e) an ethical dilemma.

Explanation:An Ethical dilemma is a situation where a person is faced with two opposing options where one is a normal and appropriate thing to do while the other is concerned with ones Relationships.

Most managers are faced with Ethical dilemmas on a daily basis as they have to choose between Maintaining their friendships or strictly adhering to Ethical obligations and standards. Bob, the owner of Orthopedic Supply, is faced with an Ethical dilemma between sparing his friends and trusted friend and following Ethical standards.

7 0
3 years ago
Comparing how many dollars it takes you to run your car each year to annual earnings on a job insteadof keeping track of costs i
stepan [7]

Answer:

B

Explanation:

Money has several functions, one of its principal function is using it as unit of account. By comparing the amount in dollars spent on running a car yearly to annual earnings instead of keeping track in terms of gasoline cost and quarts of oil shows that money has been used as a unit of account.

This means that the amount of gasoline gallons bought and quarts of oil has been essentially replaced by the cost of these purchases and hence avail is the power to use money as a unit of account

5 0
3 years ago
Nutrient cycling and purification of water are both examples of
ira [324]

Answer:

Nutrient cycling and purification of water are both examples of Essential Services

5 0
2 years ago
Studies show that dealing with excessive and unimportant e-mail and text messages in the workplace can lead to A) decreased empl
yulyashka [42]

Answer:

The correct answer is letter "D": concentrating on the urgent rather than the important.

Explanation:

<em>Excessive e-mailing</em> causes increased employee conflict and stress. Under that scenario, employees have to find ways to discriminate among all those messages the ones the have to attend first. <em>This leads to workers replying to urgent e-mails rather than important messages. </em>The overall situation provokes delays in major projects or to leave on standby potential opportunities to generate profit.

6 0
3 years ago
Product sales: 1,000 units at $10 eachVariable manufacturing costs: $5.50 per unitFixed manufacturing overhead: $1,200Variable s
raketka [301]

Answer:

The correct answer to the following question is option C)  $1800.

Explanation:

Given information -

Product sales - 1000 units

Sales price - $10

Variable manufacturing cost - $5.50 per unit

Fixed manufacturing overhead - $1200

Variable selling and administrative costs - $.50 per unit

Fixed selling and administrative cost - $1000

Units produced - 1200 units

Manufacturing contribution per unit = Sales price per unit - Variable              

                                                                                manufacturing cost per unit

= $10 -$5.50

= $4.50

Manufacturing contribution margin -

Number of units sold x manufacturing contribution per unit

= 1000 x $4.50

= $4500

While the contribution margin per unit -

$4.50 - $.50

= $4

which means the total contribution margin would be 1000 x $4

= $4000

And now subtracting Fixed manufacturing overhead and Fixed selling and administrative costs from the total contribution margin to get the operating income -

$4000 - $1200 - $1000

= $1800

3 0
3 years ago
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