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Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw
Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). The income statement for Marley's Manufacturing is shown below: Marley's Manufacturing Income Statement Month Ending August 31, 2018 Dept. A Dept. B Sales $23,000 $52,000 Cost of goods sold 10,810 27,040 Gross profit $12,190 $24,960 Utility expenses 1,380 3,120 Wages expense 5,750 10,400 Costs allocated from corporate 2,530 15,080 Total expenses $9,660 $28,600 Operating income/(loss) in dollars $2,530 -$3,640 Operating income/loss) in percentage 11 % -7% Assume the market price for the items your department purchase is 15% below what you are being charged by department A of Marley's Manufacturing. . Determine the operating income for department B, assuming department A "sold" department B 1,000 units during the month and department A reduces the selling price to the market price. Round your percentage answer to one decimal place. New operating income/(loss) for department B in dollars New operating income/(loss) for department B in percentage % Asume you are the department for Marley's acting Marteses under co-based me you receive the of your treatment which se only to department (they have no ideas The income statement for Male Maracturing is the below Marley's Manufacturing Income Statement Month Ending August 31, 2018 Dept. Dept. 123,000 $32.000 Cost of goods sold 10.810 27.040 rss prot 312,190 Upen 3.120 Wages 5,750 10.400 Corts located from corporate 2.530 15,060 Total expenses 39.660 128.600 Operating income/t) in dollars 52,530 $3.640 Operating incomalo) in percentage IS A Asume the market price for the same your department purchases 15 How what you are being charged by department of Pure Mantung Determine the operating income for department, assuming rartment Aseidepartment 1.000 units Guing the month and department A reduces the reling price to the man et pea, Hound your percentage answer to one decimal place. New operating income/oss) for department is daar New operating income (los) for department in percentage >
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