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Please show all work in order to receive thumbs up. Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based
Please show all work in order to receive thumbs up.
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 $50,000 Cost of goods sold 10,810 26,500 Gross profit $12,190 $23,500 Utility expenses 1,380 3,000 Wages expense 5,980 10,500 Costs allocated from corporate 2,300 15,000 Total expenses $9,660 $28,500 Operating income/loss) in dollars $2,530 -$5,000 Operating income/loss) in percentage 11 % -10 % 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 $ -23,050 x New operating income/(loss) for department B in percentage -8 X %
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