User Account

All Pages

Solve minimum transfer price from the bottle division

Assignment Help Managerial Accounting
Reference no: EM132556885

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.

Question 1: 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: EM132556885

Questions Cloud

Why lowe company profits were lower than : Why Lowe Company's profits for 2008 were lower than those reported by High Company despite the fact that Lowe Company's sales were higher .
What would be the company and break-even point : What would be the company, break-even point in terms of dollar sales if it adopts this new method? Assume that the sales price per unit would not be changed.
What effective annual interest rate : What effective annual interest rate does the firm earn when a customer does not take discount
Ethics in business relationships : Ethics in business relationships include both the external and internal relationships that develop around the organization.
Solve minimum transfer price from the bottle division : Using the general rule, calculate the minimum transfer price from the Bottle Division to the Cologne Division. Explain your answer.
Discuss culturally charged issue : cthat you have experienced in the workplace. How was this issue dealt with by management?
Compute the depreciation expense for the year ended : Compute the depreciation expense for the year ended December 31, 2016. McPherson elected to depreciate the building on a straight-line basis
What is the risk adjusted npv of the project : Company Y has conducted a risk assessment on a project it is considering. The company adjusts its WACC by adding a risk premium
Find how many units will to be sold to meet target profit : Find How many units will have to be sold to meet this target profit? Assume that next year management wants the company to earn a minimum profit of $ 90,000.

Reviews

Write a Review

Managerial Accounting Questions & Answers

  What was the segment margin for the west segment

What was the segment margin for the West segment? While the East segment has been consistently profitable, the most recent income statement

  How classified a a factory overhead cost by a baking company

Which of the following would be classified as a factory overhead cost by a baking company? Freight costs to deliver baked goods to the customer

  Analyze the effects of unusual or irregular items

Explain the ways financial information is used in health care organizations - Explain the use of the financial statement analysis as a method to address financial issues.

  Prepare the monthly sales revenue and cash collection budget

ACC00146 MANAGEMENT ACCOUNTING ASSIGNMENT, Southern Cross University, Australia. Prepare the Monthly Sales Revenue and Cash Collection Budget

  Determine the project profitability index for each project

Compute the project profitability index for each project. (Round your answers to 2 decimal places.) Rank the projects in terms of preference

  Is merediths strategy one of product cost leadership

Is Meredith's strategy one of product differentiation or cost leadership? Explain briefly. Describe briefly key elements that you would include in Meredith's balanced scorecard and the reasons for doing so.

  What type of preferred share is entitled to dividends

What type of preferred share is entitled to dividends above its specified dividend if the common shares receive excess dividends and must receive

  Determine will also necessarily achieve high profitability

If the company is successful in achieving challenging targets for these performance measures, will it also necessarily achieve high profitability?

  Make process account and joint product profit statement

How to prepare process 3 account and joint product profit statement?A split of point arises immediately after three series of continuous processes.

  Prepare the raw material purchase budget for the quarter

Prepare the Raw Material Purchase Budget for the quarter ended June 30, 2020. Prepare the Sales Budget for the quarter ended June

  Estimate what is the contribution margin ratio

Operating the theater is $100,000 per month. The company can accommodate 12,000 patrons each month. What is the contribution margin ratio?

  How many job advertisements you have collected in total

HI5020 Corporate Accounting-Holmes Institute- Australia-How many job advertisements you have collected in total? How many job advertisements you have collected.

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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