19. Abbott Sandwich corporation has 2 operating divisions: peanut butter and jelly. Peanut butter manufactures buttered...

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19. Abbott Sandwich corporation has 2 operating divisions: peanut butter and jelly. Peanut butter manufactures buttered slices and can sell them to customers at $5/buttered slice and the variable cost is $3/slice. Currently, jelly has a capacity of 200 sliced sandwiches and the annual external demand for sliced sandwiches is 180 sliced sandwiches. Peanut butter has a capacity of 200 buttered slices and annual demand for buttered slices is 50 buttered slices. Calculate what the 'transfer price' should be (4 pts). 19. Abbott Sandwich corporation has 2 operating divisions: peanut butter and jelly. Peanut butter manufactures buttered slices and can sell them to customers at $5/buttered slice and the variable cost is $3/slice. Currently, jelly has a capacity of 200 sliced sandwiches and the annual external demand for sliced sandwiches is 180 sliced sandwiches. Peanut butter has a capacity of 200 buttered slices and annual demand for buttered slices is 50 buttered slices. Calculate what the 'transfer price' should be (4 pts).

Answer rating: 100% (QA)

Answer To determine the transfer price we need to consider the opportunity cost and the market value ... View the full answer