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asap please Exercise 11-7 (Algo) Transfer Pricing from the Viewpoint of the Entire Company (L011-3) Division A manufactures electronic circuit boards. The boards can be
asap please
Exercise 11-7 (Algo) Transfer Pricing from the Viewpoint of the Entire Company (L011-3) Division A manufactures electronic circuit boards. The boards can be sold either to Division of the same company or to outside customers. Last year, the following activity occurred in Division A Selling price per circuit board 193 Variable cont per circuit board $ 119 Number of circuit boards Produced during the year 20,300 sold to outside customers 15.900 Sold to Division B 4.400 Sales to Division B were at the same price as sales to outside customers. The circuit boards purchased by Division B were used in an electronic Instrument manufactured by that division (one board per instrument). Division Bincurred $210 in additional variable cost per Instrument and then sold the instruments for $700 each Required: 1. Calculate the net operating incomes earned by Division A. Division B, and the company as a whole 2. Assume Division A's manufacturing capacity is 20,300 circuit boards. Next year, Division B wants to purchase 5,400 circuit boards from Division A rather than 4,400 (Circuit boards of this type are not available from outside sources) From the standpoint of the company as a whole should Division A sell the 1.000 additional circuit boards to Division B or continue to sell them to outside customers? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Calculate the net operating incomes earned by Division A, Dividon B, and the company as a whole Division Division Total Company 5.1.176,600 5 2.158,000 5 3,332.600 Expenses Added by the division Transfer price paid Totale Nel operating income 0 5.1.170.000 2.150.000 $ 0 3:332.600 Required 2 > Step by Step Solution
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