Find and calculate trailer return on investment

Assignment Help Managerial Accounting
Reference no: EM132556653

Question 1: Fragrance Pty Ltd has two (2) divisions: the Cologne Division and the Bottle Division. The company is de-centralised and each division is evaluated as a profit centre.

The Bottle Division produces bottles that can be used by the Cologne Division. The Bottle Division's variable manufacturing cost per unit is $2.00 and shipping costs are $0.10 per unit. The Bottle Division's external sales price is $3.00 per unit. No shipping costs are incurred on sales to the Cologne Division. The Cologne Division can purchase similar bottles in the external market for $2.50. The Bottle Division has sufficient capacity to meet all external market demands in addition to meeting the demands of the Cologne Division.

Using the general rule, calculate the minimum transfer price from the Bottle Division to the Cologne Division. Explain your answer

Question 2: For the period just ended, Trek Corporation's Trailer Division reported profit of $54 million and invested capital of $450 million. Assuming an imputed interest rate of 10 per cent, calculate Trailer's return on investment (ROI) and residual income. Explain what each calculation of ROI and RI means for Trek.

Reference no: EM132556653

Questions Cloud

Evaluate what should be the budgeted sales in units : Evaluate what should be the budgeted sales in units? The company plans to include a safety margin of $20 000 before tax. Assuming a tax rate of 30%.
Calculate the equity value or the enterprise value : How about Levered FCFs vs Unlevered FCFs? Why? Should you calculate the equity value or the enterprise value? Why?
What is the net present value of the project : What is the net present value (NPV) of the project if the company's cost of capital is 10.53 percent?
Great tenor saxophone players mentioned : Spend some time listening to a few of the great tenor saxophone players mentioned in chapter 7
Find and calculate trailer return on investment : Find and calculate Trailer's return on investment (ROI) and residual income. Explain what each calculation of ROI and RI means for Trek.
Server virtualization and cloud computing : Describe the organization's environment, and evaluate its preparedness for virtualization.
How to determine the total material variance : Determine the total material variance. Cultco Company Ltd has set the following direct material standards per unit of product: 2.5 kg @ $3.00 per kg
Which component of the coso risk management framework : On July 21, 2015, Toshiba CEO Hisao Tanaka announced his resignation in face, Which component of the COSO risk management framework failed at Toshiba and why
What are the different types of dividends : What are the different types of dividends, and how is a dividend paid?

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Manage budgets and financial plans

Explain the budgeting process and its importance to a business, identifying the components of different budgets, forecast estimates for inclusion in the budgets.

  Prepare a retained earnings statement

Prepare a retained earnings statement for the year and Prepare a stockholders' equity section of given case.

  Prepare a master budget for the three-month period

Prepare a master budget for the three-month period.

  Construct the companys direct labor budget

Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.

  Evaluate the predetermined overhead rate

Evaluate the Predetermined Overhead Rate

  Determine the company''s bid

Determine the company's bid if activity-based costing is used and the bid is based upon full manufacturing cost plus 30 percent.

  Compute the pool rates for the different activities

Complete the schedule to compute the pool rates for the different activities.

  Prepare Company financial statements

Prepare Company financial statements

  Prepare an analysis of terracycles

This individual assignment is based on the TerraCycle Inc.

  Discuss the ethical issues

Discuss the ethical issues

  Political resources in emerging markets

Calculate the GDP in Income Approach  and Expenditure Approach

  Management accounting - ehsan electronics company

A new plant accountant suggested that the company may be able to assign support costs to products more accurately by using an activity based costing system that relies on a separate rate for each manufacturing activity that causes support costs.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd