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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
Athlete’s Companion Division makes top-of-the-line sports travel bags that are sold to external buyers and are also being used by the Travel America Division. During the month just ended, Travel America acquired 2,000 bags from Athlete’s Companion Division. Athlete’s Companion’s standard unit costs are
|
Direct material |
$10 |
|
Direct labor |
3 |
|
Variable factory overhead |
4 |
|
Fixed factory overhead |
6 |
|
Variable selling expense |
2 |
|
Fixed selling and administrative expense |
3 |
Travel America can acquire comparable bags externally for $40 each. Give the entries for each division for the past month if the transfer is to be recorded
a. at Travel America’s external purchase price.
b. at a negotiated price of variable cost plus 15 percent of production cost.
c. by Athlete’s Companion at Travel America’s external price and by Travel America at Athlete’s Companion’s variable production cost.
d. at Athlete’s Companion’s absorption cost.
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