Reference no: EM132965706
Questions -
Q1. ABC Corporation has excess capacity. If the firm desires to implement the general transfer-pricing rule, opportunity cost would be equal to:
zero.
the direct 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.
Q2. ABC makes all sales on account, subject to the following collection pattern: 30% are collected in the month of sale; 60% are collected in the first month after sale; and 10% are collected in the second month after sale. If sales for April, May, and June were $60,000, $80,000, and $70,000, respectively, what were the firm's budgeted collections for June?
$60,000.
$21,000.
$69,000.
$75,000.
Some other amount.
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