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kap26 [50]
3 years ago
13

nder the general transfer pricing rule with excess capacity, the opportunity cost would be equal: Multiple Choice zero. the dire

ct expenses incurred in producing the goods. the total difference in the cost of production between two divisions. the contribution margin forgone from the lost external sale. the summation of variable cost plus fixed cost.
Business
2 answers:
choli [55]3 years ago
7 0

Answer:

zero

Explanation:

When there is an excess capacity available, the opportunity cost will be zero, company can use this capacity to make the potential benefit from an alternative. Transfer pricing is the price charged to a subsidiary division of a company. This price can also be charged by the subsidiary to the parent company. Some companies use this to manage the tax matters. It may also applicable to the transfer of assets of the companies.

Thepotemich [5.8K]3 years ago
3 0

Answer:

ZERO.

Explanation:

A transfer price normally is used to determine the cost to charge another division, subsidiary, or holding company for services rendered. It is said that transfer prices are priced based on the going market price for that good or service. Transfer pricing can also be applied to intellectual property such as research, patents, and royalties.

However, companies at times can also use (or misuse) this practice by altering their taxable income, thus reducing their overall taxes. The transfer pricing mechanism is a way that companies can shift tax liabilities to low-cost tax jurisdictions.

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sladkih [1.3K]

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3 years ago
A company using the perpetual inventory system purchased inventory worth $ 22 comma 000 on account with terms of 2​/10, ​n/30. D
EastWind [94]

Answer:

Discount = $420

Explanation:

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to find out

amount of the purchase discount that would be available to the company is​

solution

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so Net Purchases = $22000  - $1000

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so

discount claim for $21000  is 2%

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4 0
3 years ago
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7 0
2 years ago
Read 2 more answers
John manufactures household furniture. His start-up costs, including tools, plans, and advertising, total \$5000$5000dollar sign
scZoUnD [109]

Answer:

$5,000 + $350f

Explanation:

The computation of the production cost in dollars is shown

Here we use the equation form

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3 years ago
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