Maurice Tutor

(5)

$15/per page/Negotiable

About Maurice Tutor

Levels Tought:
Elementary,Middle School,High School,College,University,PHD

Expertise:
Algebra,Applied Sciences See all
Algebra,Applied Sciences,Biology,Calculus,Chemistry,Economics,English,Essay writing,Geography,Geology,Health & Medical,Physics,Science Hide all
Teaching Since: May 2017
Last Sign in: 407 Weeks Ago, 5 Days Ago
Questions Answered: 66690
Tutorials Posted: 66688

Education

  • MCS,PHD
    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

Experience

  • Professor
    Phoniex University
    Oct-2001 - Nov-2016

Category > Management Posted 29 Oct 2017 My Price 9.00

Transistor Division

TRANSFER PRICING

Truman Industries is a vertically integrated firm with several divisions that operate as decentralized profit centers. Truman’s Systems Division manufactures scientific in- struments and uses the products of two of Truman’s other divisions. The Board Division manufactures printed circuit boards (PCBs). One PCB model is made exclusively for the Systems Division using proprietary designs, while less complex models are sold in outside markets. The products of the Transistor Division are sold in a welldeveloped competitive market; however, one transistor model is also used by the Systems Division. The costs per unit of the products used by the Systems Division are as follows:

 

PCB

Transistor

Direct materials

$2.00

$0.40

Direct labor

4.00

1.00

Variable overhead

2.35

0.50

Fixed overhead

0.80

0.75

Total cost

$9.15

$2.65

The Board Division sells its commercial product at full cost plus a 34 percent markup and believes the proprietary board made for the Systems Division would sell for $12.25 per unit on the open market. The market price of the transistor used by the Systems Division is $3.40 per unit.

Required:

1. What is the minimum transfer price for the Transistor Division? What is the maximum transfer price of the transistor for the Systems Division?

2. Assume the Systems Division is able to purchase a large quantity of transistors from an outside source at $2.90 per unit. Further assume that the Transistor Division has excess capacity. Can the Transistor Division meet this price?

3. The Board and Systems divisions have negotiated a transfer price of $11 per printed circuit board. Discuss the impact this transfer price will have on each division.

Answers

Maurice Tutor
(5)
Status NEW Posted 29 Oct 2017 05:10 PM My Price 9.00

Hel-----------lo -----------Sir-----------/Ma-----------dam-----------Tha-----------nk -----------You----------- fo-----------r u-----------sin-----------g o-----------ur -----------web-----------sit-----------e a-----------nd -----------and----------- ac-----------qui-----------sit-----------ion----------- of----------- my----------- po-----------ste-----------d s-----------olu-----------tio-----------n.P-----------lea-----------se -----------pin-----------g m-----------e o-----------n c-----------hat----------- I -----------am -----------onl-----------ine----------- or----------- in-----------box----------- me----------- a -----------mes-----------sag-----------e I----------- wi-----------ll

Not Rated(0)