Div A Budgeted actuals variance variance $\%$

Raw material units $100,000105,0005,0005\%$

Average unit price $109\mathrm{.}8-0\mathrm{.}2-2$

Total sales $1,000,0001,029,00029,0002\mathrm{.}90\%$

Total costs $800,000824,50024,5003\mathrm{.}06\%$

Net income $200,000204,5004,5002\mathrm{.}25\%$

Div B Budgeted actuals variance variance $\%$

Intermediate produce units $30,00035,0005,00016\mathrm{.}67\%$

Unit price $18\mathrm{.}018\mathrm{.}512\mathrm{.}78\%$

total sales $540,000647,500107,50019\mathrm{.}91\%$

raw materials per unit from Div A $109\mathrm{.}80-2\mathrm{.}00\%$

Variable conversion cost per unit $55\mathrm{.}102\mathrm{.}00\%$

total costs $450,000521,50071,50015\mathrm{.}89\%$

net income $90,000126,00036,00040\mathrm{.}00\%$

Div C Budgeted actuals variance variance $\%$

Final products $20,00022,0002,000\mathrm{.}010\mathrm{.}00\%$

Unit price $3232\mathrm{.}50\mathrm{.}51\mathrm{.}56\%$

total sales $640,000715,00075,000\mathrm{.}011\mathrm{.}72\%$

intermediate product from Div B $1818\mathrm{.}50\mathrm{.}52\mathrm{.}78\%$

Variable conversion per unit $880\mathrm{.}00\mathrm{.}00\%$

total costs $520,000583,00063,000\mathrm{.}012\mathrm{.}12\%$

net income $120,000132,00012,000\mathrm{.}010\mathrm{.}00\%$

Additional info, total assets used by each division

Div A Div B Div C

Current Gross Capital investment $1,000,000500,000500,000$

Div A and C are not running at full capacity, but Div B is running at full capacity, the manager of Div B is considering adding another production line, project X$,$ and has the following projections

Project Div B is considered

Initial investment $200,000$

useful life in years $10$

additional product capacity units per year $15,000$

projected units to be sold per year $12,000$

required rates of return $10\%$

residue value $0$

req. $1$

Div A Budgeted actuals variance variance $\%$

Raw material units $100,000105,0005,0005\%$

Average unit price $109\mathrm{.}8-0\mathrm{.}2-2$

Total sales $1,000,0001,029,00029,0002\mathrm{.}90\%$

Total costs $800,000824,50024,5003\mathrm{.}06\%$

Net income $200,000204,5004,5002\mathrm{.}25\%$

Div B Budgeted actuals variance variance $\%$

Intermediate produce units $30,00035,0005,00016\mathrm{.}67\%$

Unit price $18\mathrm{.}018\mathrm{.}512\mathrm{.}78\%$

total sales $540,000647,500107,50019\mathrm{.}91\%$

raw materials per unit from Div A $109\mathrm{.}80-2\mathrm{.}00\%$

Variable conversion cost per unit $55\mathrm{.}102\mathrm{.}00\%$

total costs $450,000521,50071,50015\mathrm{.}89\%$

net income $90,000126,00036,00040\mathrm{.}00\%$

Div C Budgeted actuals variance variance $\%$

Final products $20,00022,0002,000\mathrm{.}010\mathrm{.}00\%$

Unit price $3232\mathrm{.}50\mathrm{.}51\mathrm{.}56\%$

total sales $640,000715,00075,000\mathrm{.}011\mathrm{.}72\%$

intermediate product from Div B $1818\mathrm{.}50\mathrm{.}52\mathrm{.}78\%$

Variable conversion per unit $880\mathrm{.}00\mathrm{.}00\%$

total costs $520,000583,00063,000\mathrm{.}012\mathrm{.}12\%$

net income $120,000132,00012,000\mathrm{.}010\mathrm{.}00\%$

Additional info, total assets used by each division

Div A Div B Div C

Current Gross Capital investment $1,000,000500,000500,000$

ld in the market or supply Div C who will complete the products and sold at a higher price. For $2023,$ its divisions budget and actuals are as the following: Requirements: $1.$ calculate the $2023$ flexible budget variance and sales volume variance of div B$.2.$ Calculate the NPV of project X$.$ Div B uses $2023$ actuals contribution margin per unit. Based on NPV should Div B implement project X or not? What is the payback period? $3.$ The mangers are measured by ROI, based on ROI of div B$,$ will the manager implement project X or not? Explain ur answer. The capital investment is calculated at gross value of the assets. $4.$ Div C received a special order and need additional $3,000$ units pf the intermediate product, Div C received two quotes, $$18\mathrm{.}5$ each from Div B$,$ or $$18$ each from an outside vendor with similar intermediate product. What should Div B do without project X$,$ to keep the price or lower it to match the price from outside vendor? Explain your answer. $5.$ For the special order mentioned in step $4,$ if Div B already implemented project X$,$ based on the projection, does div B has idle capacity? What transfer pricing methods can be used? consider theoritcally what the maximum price Div C would be willing to pay, and minimum price Div B could sell for. What method do you recommend $($hint $-$ keeping in mind the organizational structure, analyze the different transfer price methods and arrive the recommendation$)?$ All calculations ignore tax implicatDiv A and C are not running at full capacity, but Div B is running at full capacity, the manager of Div B is considering adding another production line, project X$,$ and has the following projections

Project Div B is considered

Initial investment $200,000$

useful life in years $10$

additional product capacity units per year $15,000$

projected units to be sold per year $12,000$

required rates of return $10\%$

residue value $0$