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please help Hrubec Products, Incorporated, operates a Puip Division that manufactures wood pulp for use in the production of various paper goods. Revenue and costs
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Hrubec Products, Incorporated, operates a Puip Division that manufactures wood pulp for use in the production of various paper goods. Revenue and costs associated with a ton of pulp follow Selling price $ 70 Expenses: Variable $.42 Fixed (based on a capacity of 50,000 tons per year) 18 60 Net operating income $ 10 Hrubec Products has just acquired a small company that manufactures paper cartons. Hrubec plans to treat its newly acquired Carton Division as a profit center. The manager of the Carton Division is currently purchasing 5.000 tons of pulp per year from a supplier ata cost of $63 per ton. Hrubec's president is anxious for the Carton Division to begin purchasing its pulp from the Pulp Division if the managers of the two divisions can negotiate an acceptable transfer price Required: For () and (2) below, assume the Pulp Division can sell all of its pulp to outside customers for $70 per ton. 1. What is the Pulp Division's lowest acceptable transfer price? What is the Carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices of any) between the two divisions? Are the managers of the Corton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? 2. If the Pulp Division meets the price that the Carton Division is currently paying to its supplier and sells 5,000 tons of pulp to the Corton Division each year , what will be the effect on the profits of the Pulp Division, the Carton Division, and the company as a whole? For (3)-(6) below, assume that the Pulp Division is currently selling only 30,000 tons of pulp each year to outside customers at the stated $70 price 3. What is the Pulp Division's lowest acceptable transfer price? What is the Carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? 4a. Suppose the Carton Division's outside supplier drops its price to only $59 per ton. Should the Pulp Division meet this price? 4-6. If the Pulp Division does not meet the $59 price, what will be the effect on the profits of the company as a whole? 5. Refer to (4) above. If the Pulp Division refuses to meet the $59 price, should the Carton Division be required to purchase from the Pulp Division at a higher price for the good of the company as a whole? 6. Refer to (4) above. Assume that due to inflexible management policies, the Carton Division is required to purchase 5,000 tons of pulp each year from the Pulp Division at $70 per ton. What will be the effect on the profits of the company as a whole? 4 Book Required: For (1) and (2) below, assume the Pulp Division can sell all of its pulp to outside customers for $70 per ton. 1. What is the Pulp Division's lowest acceptable transfer price? What is the Carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? 2. If the Pulp Division meets the price that the Carton Division is currently paying to its supplier and sells 5,000 tons of pulp to the Carton Division each year , what will be the effect on the profits of the Pulp Division, the Carton Division, and the company as a whole? For (3)-(6) below, assume that the Pulp Division is currently selling only 30,000 tons of pulp each year to outside customers at the stated $70 price 3. What is the Pulp Division's lowest acceptable transfer price? What is the carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? 4- Suppose the Carton Division's outside supplier drops its price to only $59 per ton. Should the Pulp Division meet this price? 4.6. If the Pulp Division does not meet the $59 price, what will be the effect on the profits of the company as a whole? 5. Refer to (4) above. If the Pulp Division refuses to meet the $59 price, should the Carton Division be required to purchase from the Pulp Division at a higher price for the good of the company as a whole? 6. Refer to (4) above. Assume that due to inflexible management policies, the Carton Division is required to purchase 5,000 tons of pulp each year from the Pulp Division at $70 por ton What will be the effect on the profits of the company as a whole onces Complete this question by entering your answers in the tabs below. Req: Req2 Req3 Reg 4A Req 48 Reqs Reg 6 What is the Pulp Division's lowest acceptable transfer price? What is the carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? Range of acceptable transfer prices None of the these choices are correct Are the managers likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? No 4 nts 1. What is the Pulp Division's lowest acceptable transfer price? What is the Carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? 2. If the Pulp Division meets the price that the Carton Division is currently paying to its supplier and sells 5,000 tons of pulp to the Carton Division each year, what will be the effect on the profits of the Pulp Division, the Carton Division, and the company as a whole? For (3)-(6) below, assume that the Pulp Division is currently selling only 30,000 tons of pulp each year to outside customers at the stated $70 price 3. What is the Pulp Division's lowest acceptable transfer price? What is the Carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? 4-a. Suppose the Carton Division's outside supplier drops its price to only $59 per ton. Should the Pulp Division meet this price? 4-6. If the Pulp Division does not meet the $59 price, what will be the effect on the profits of the company as a whole? 5. Refer to (4) above. If the Pulp Division refuses to meet the $59 price, should the Carton Division be required to purchase from the Pulp Division at a higher price for the good of the company as a whole? 6. Refer to (4) above. Assume that due to inflexible management policies, the Carton Division is required to purchase 5,000 tons of pulp each year from the Pulp Division at $70 per ton. What will be the effect on the profits of the company as a whole?' eBook Print bforences Complete this question by entering your answers in the tabs below. Reg 1 Reg 4 Reg 6 Reg 2 Reg 3 Req 48 Reg 5 If the Pulp Division meets the price that the Carton Division is currently paying to its supplier and sells 5,000 tons of pulp to the Carton Division beach year, what will be the effect on the profits of the Pulp Division, the Carton Division, and the company as a whole? a. Profits of the Pulp Division will b. Profits of the Carton Division will ty c. Profits of the company as a whole will by Reg 3 > BE For (3)-(6) below, assume that the Pulp Division is currently selling only 30,000 tons of pulp each year to outside customers at the stated $70 price 3. What is the Pulp Division's lowest acceptable transfer price? What is the Carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? 4-a. Suppose the Carton Division's outside supplier drops its price to only $59 per ton. Should the Pulp Division meet this price? 4-6. If the Pulp Division does not meet the $59 price, what will be the effect on the profits of the company as a whole? 5. Refer to (4) above. If the Pulp Division refuses to meet the $59 price, should the Carton Division be required to purchase from the Pulp Division at a higher price for the good of the company as a whole? 6. Refer to (4) above. Assume that due to inflexible management policies, the Carton Division is required to purchase 5,000 tons of pulp each year from the Pulp Division at $70 per ton. What will be the effect on the profits of the company as a whole? Complete this question by entering your answers in the tabs below. Reg 2 Reg 1 Reg 3 Reg 4 Reg 48 Reg 5 Reg 6 What is the Pulp Division's lowest acceptable transfer price? What is the Carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? Identify the lowest and highest acceptable transfer prices Lowest acceptable transfer price Highest acceptable transfer price Range of acceptable transfer prices Are the managers likely to voluntarly agree to a transfer price for 5,000 tons of pulp next year? COHON DIVISION Call year, WIL WII Veule NELL UIT TE PIURILS UI Ue rup DIVISION, ILOILOR DIVISION, OHTU E Cory as a WIIUIT For (3)(6) below, assume that the Pulp Division is currently selling only 30,000 tons of pulp each year to outside customers at the stated $70 price 3. What is the Pulp Division's lowest acceptable transfer price? What is the Carton Division's highest acceptable transfer price? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 5,000 tons of pulp next year? 4-a. Suppose the Carton Division's outside supplier drops its price to only $59 per ton. Should the Pulp Division meet this price? 4-b. If the Pulp Division does not meet the $59 price, what will be the effect on the profits of the company as a whole? 5. Refer to (4) above. If the Pulp Division refuses to meet the $59 price, should the Carton Division be required to purchase from the Pulp Division at a higher price for the good of the company as a whole? 6. Refer to (4) above. Assume that due to inflexible management policies, the Carton Division is required to purchase 5,000 tons of pulp each year from the Pulp Division at $70 per ton. What will be the effect on the profits of the company as a whole? Complete this question by entering your answers in the tabs below. Reg 4A Ross Reg 5 Req 1 Reg 2 Reg 3 Reg 48 Reg 6 If the Pulp Division does not meet the $59 price, what will be the effect on the profits of the company as a whole? Profit of the company will decrease by es For (3)-(6) below, assume that the Pulp Division is currently selling only 30,000 tons of pulp each year to outside customers stated $ 70 price 3. What is the Pulp Division's lowest acceptable transfer price? What is the Carton Division's highest acceptable transfer pric the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Division voluntarily agree to a transfer price for 5,000 tons of pulp next year? 4a. Suppose the Carton Division's outside supplier drops its price to only $59 per ton. Should the Pulp Division meet this p 4-b. If the Pulp Division does not meet the $59 price, what will be the effect on the profits of the company as a whole? 5. Refer to (4) above. If the Pulp Division refuses to meet the $59 price, should the Carton Division be required to purchase Pulp Division at a higher price for the good of the company as a whole? 6. Refer to (4) above. Assume that due to inflexible management policies, the Carton Division is required to purchase 5,000 pulp each year from the Pulp Division at $70 per ton. What will be the effect on the profits of the company as a whole? -Book Print Complete this question by entering your answers in the tabs below. rences Reg 1 Reg 2 Reg 3 Req 4A Reg 4B Reg 5 Reg 6 Refer to (4). Assume that due to inflexible management policies, the Carton Division is required to purchase 5,000 tons of pulp each year from the Pulp Division at $70 per ton. What will be the effect on the profits of the company as a whole? The company as a whole will have an) increase In profit by Step by Step Solution
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