1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
kirill115 [55]
3 years ago
6

Fois Company has two divisions, Division X and Division Y. Division X has a production capacity of 5,000 units of a particular p

art per month. Division X sells 4,400 units of the part each month to outside customers at a contribution margin of $56 per unit. Division Y would like to buy 800 units of the part each month from Division X. In computing the lowest acceptable transfer price from the perspective of the selling division, the lost contribution margin per unit portion of the transfer price computation would be:
Business
1 answer:
kogti [31]3 years ago
8 0

Answer:

Lost contribution per unit = $56 per unit

Explanation:

The Division X is operating at less than full capacity, hence it has excess capacity   of  600 units i.e (5000- 4,400)

This implies that it can only produce to meet the external and a portion of  Division Y demand  

Since Division X can only accommodate a portion of the internal demand, an opportunity would arise if it decides to meet all the request of Division Y.

Therefore, the minimum transfer price

minimum transfer price= Variable cost + a lost contribution from internal supply

The lost contribution represent the amount Division X would have made had sold the units to external buyers

Lost contribution per unit = $56 per unit

You might be interested in
Sutton Enterprises makes gadgets using a two-step process that involves machining and assembly, respectively. During the period,
MaRussiya [10]

Answer:

Total equivalent units= 11,890

Explanation:

Giving the following information:

Assembly Department completes 10,200 gadgets and transfers them to Finished Goods Inventory.

The Assembly Department has 2,600 gadgets in the process that are 65% complete for conversion.

<u>To calculate the equivalent units, we need to multiply the % complete for the number of units started:</u>

Units completed= 10,200

Units in ending inventory= 2,600*0.65= 1,690

Total equivalent units= 11,890

5 0
3 years ago
Which of the following businesses describes a branch?
Sergio [31]
I believe that it’s C
ANSWER =C
4 0
2 years ago
Magna Carta was the result of the king's disastrous foreign policy and overzealous financial administration. John had suffered a
Korvikt [17]

Answer:

The correct answer is  A. King John’s poor financial decisions and loss of territory

Explanation:

4 0
3 years ago
Read 2 more answers
The Back Room just paid an annual dividend of $1.50 a share. The firm expects to pay dividends forever and to increase the divid
umka2103 [35]

Answer:

$26.05

Explanation:

according to the constant dividend growth model

price = d1 / (r - g)

d1 = next dividend to be paid = d0 x (1 + growth rate)

d0 = dividend that was just paid

r = cost of equity

g = growth rate

1.5 x (1.045^6) / 12 - 4.5 = $26.05

6 0
3 years ago
Explain your return on educational investment?
Eva8 [605]
Nyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyy
6 0
3 years ago
Other questions:
  • For which persons may a taxpayer deduct medical expenses?
    13·1 answer
  • Clayton is asking his life insurance producer about any potential taxation issues related to his $100,000 personal Whole Life po
    10·1 answer
  • Jennifer Burroughs is thinking about starting a firm in the upscale​ women's fashion industry. To get a full appreciation of the
    15·1 answer
  • A(n) ________ collects data from various key business processes and stores the data in a single comprehensive data repository, u
    10·1 answer
  • The competitive moves and business approaches a company's management is using to grow the business, compete successfully, attrac
    14·1 answer
  • 1. What is the difference between a MIS and formal market research?
    12·1 answer
  • Some people believe that the shuttle should have been better engineered for crew safety, including provisions for repair of the
    11·1 answer
  • Which of the following statements explains the concept of the tragedy of the​ commons? ​(Check all that apply.​) A. It occurs du
    13·1 answer
  • At what age can you start working?
    10·2 answers
  • Assume a company has a $350 credit (not cash) sale. how would the transaction appear if the business uses accrual accounting?
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!