People Able Computer Inc, with headquarters in Neptan, Ontario. Required manulactures and selis a premium desktop computer 5ystem People Able has three divisions, each of which is located in a different 1. Calculale the after-tax operating income per unit eamed by country. Each division is run as a profit centre. The costs for the work oach division under the following trarisfer-pricing methods: (a) natket price, (b) 250\% of full cost and (c) done in each division for a single desktop computer system are as follows. 450% of variable cost. (Income taxes are not included in the computation of the cost-based transfer pricesi) (Click the icon to view the data.) 2. Which transfor-pricing method(s) will maximize the after-tax operating income per uhit of People Able Computer Inc? Chinese income tax rate on China division's operating income South Korean income tax rate on South Korea division's operating income 25% Canadian income tax rate on Canada division's operating income 28% Chinese income tax rate on China division's operating income South Korean income tax rate on South Korea division's operating income 25% Canadian income tax rate on Canada division's operating income 28% Each desktop computer package is sold to retail outlets in Canada for $3,800. Assume that the current foreign exchange rates are as follows: 7yuan1,500won=CAS1=CAS1 Both the China and the South Korea divisions sell part of their production under a private label. The China division selis the comparable memorykeyboard package used in each People Able desktop computer to a Chinese manufacturer for 3,500 yuan. The South Korea division sells the comparable desktop computer package to a South Korean distributor for 1,650,000 won Requirement 1. Calculate the after-tax operating income per unit earned by each division under the following transfer-pricing methods: (a) market price, (b) 250% of full cost, and (c) 450% of variable cost. (Income taxes are not included in the computation of the cost-based transter prices.) Begin with calculating the after-tax operating income for the China division under each method. Then, complete the table for South Korea and Canada. (Convert ali foreign currencies to CAS. Round all amounts to the nearest cent.) China division Division revenue per unit Cost per unit: Division variable cost per unit Division fixed cost per unit Total division cost per unit Division operating income per unit Incorne tax at 35% Division not income per unit \begin{tabular}{|r|r|r|} \hline$500.00 & 714 & 300 \\ \hline 100.00 & & \\ \hline 257 & 100.00 & 100.00 \\ \hline 357 & 257 & 257 \\ \hline 143 & 357 & 357 \\ \hline 50 & 357 & -57 \\ \hline 93 & 125 & -20 \\ \hline \hline & 232 & -37 \\ \hline \end{tabular}