1. A division of Deetz Company is located in a country that places restrictions on the amount of funds that may be paid as dividends to foreign owners. If Deetz Company wishes to maximize the amount of cash received from the foreign division, Deetz Company should establish a _____.

A. low transfer price of goods transferred into the country

B. high transfer price of goods transferred into the country

C. high transfer price of goods transferred out of the country

D. low transfer price of goods transferred out of the country

2. For next year, Delia Company has budgeted sales of 20,000 units, target ending inventory of 1,000 units and a beginning inventory of 800 units. How many units should be purchased?

A. 21,800

B. 19,800

C. 20,000

D. 20,200

3. Maxie Company is creating their budget for the following year. Here is their relevant information:

Expected Sales 1,000 units per month

Sales Price $15 per unit

Variable Labor costs $3 per unit

Variable Material costs $2 per unit

Fixed Costs $6,000 per month

In the first month of the new year, Maxie Company only produced and sold 800 units. What is their flexible budget operating income?

A. $2,000

B. $8,000

C. $4,000

D. $0