Answer:
a. $11
b. $35
c. If the transferring division does not have excess capacity,this would mean that some units that could have been sold externally would be transferred internally and this creates an opportunity cost. Opportunity costs increase the transfer price.However no opportunity cost exist if transferring division has excess capacity and hence a lower transfer price.
Explanation:
The minimum acceptable price is the price that is acceptable to the transferring division and out of a range of acceptable prices, it is that which would be the best for the company.
When there is excess capacity.
Note : No opportunity costs would exist.
Minimum acceptable price = Variable Cost - Internal Savings + Opportunity Cost
= $11
When there is excess capacity.
Note : Opportunity costs would exist.
Minimum acceptable price = Variable Cost - Internal Savings + Opportunity Cost
= $11 + ($35 - $11 )
= $35
Why Capacity of transferring division (Small Motor Division) has an effect on the transfer price.
If the transferring division does not have excess capacity,this would mean that some units that could have been sold externally would be transferred internally and this creates an opportunity cost. Opportunity costs increase the transfer price.However no opportunity cost exist if transferring division has excess capacity and hence a lower transfer price.
Answer:
$11,000
Explanation:
Data provided as per the requirement of net income for year 1 is here below:-
Provided consulting services = $50,000
Paid rent expense = $12,000
Paid employees salaries = $27,000
The computation of net income for Year 1 is shown below:-
Net income for Year 1 = Service revenue - Rent expense - Salary expenses
= $50,000 - $12,000 - $27,000
= $11,000
Therefore for computing the Net income for Year 1 we simply applied the above formula.
Answer:
The correct answer is letter "E": Voice-of-customer.
Explanation:
The voice-of-customer poll is helpful for firms to find out what the point of view of their customers is. This type of poll allows companies to know in deep the level of satisfaction with the products being offered and what the perception of the customers is based on the product provided by them. With this feedback, firms can make adjustments to provide clientele what they are looking for, which may increase the company revenues.
Answer: Personality
Explanation: In simple words, personality refers to a group of attributes and qualities that builds and influences the behavior of an individual. These factors are build up on the basis of life time experiences.
In the given case, Ryan has a calm and satisfactory nature and does not believe in competition.
Hence from the above we can conclude that the correct option is B .
Answer:
The correct answer is $18.5 million.
Explanation:
According to the scenario, the computation of the given data are as follows:
we can calculate the cash flow from financing activities by using following formula:
Cash flow from financing activities = Issue of common stock - Purchase of treasury stock
By putting the value, we get
Cash flow from financing activities = $39.0 million - $20.5 million
= $18.5 million
