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Ques num: 12,13,14,15, & 16 ..please 12. A corporation has issued 52 million of long-term bonds paying 8% interest and 58 million of common stock.

Ques num: 12,13,14,15, & 16 ..please image text in transcribed
12. A corporation has issued 52 million of long-term bonds paying 8% interest and 58 million of common stock. If the after-tax income - $2,500,000, the capital employed - $10 million, and the cost of capital in 12.16%, the EVA is: 3. $1.248.000 c. $1,284,000 b. (51.284,000) d. 51.121.600 13. For the following questions (13.18) about transfer pricing, assume the organization is X Co. Divisions produces a component that can be sold to outside customers at a fair market price or to Division Bata transfer price. Division Buses the component to produce a finished product it sells to outside customers. Division B can also purchase the component from an outside supplier, Co. O at a fair market price. A transfer pricing system should: maximize the transfer price c. maintain common and harmonious goals between the divisions and the entire firm b. minimize the transfer price d. none of the above 14. Division produces a small motor that can be used in Division B's final blender product. B has been purchasing the motor from Co. O for 584/unit. Division S's manager has approached the manager of Division B about selling these motors to Division B. Division S incurs these unit costs: Direct materials $16. Direct labor $8. Variable overhead $6, Fixed overhead S24 Currently, Division Scan produce 150,000 motors but is only producing 120,000. Div. B needs 20,000 units per year The maximum transfer price should be: 2. $30 b. SS54 d. $24 c. 584 5. Refer to the data in question 14. The minimum transfer price should be: a $84 c. $54 b. $24 d. $30 Refer to question 14. How should a transfer price be determined to achieve goal congruence? a. Use market price because the selling c. Negotiate a transfer price between the division is operating at full capacity minimum and maximum transfer price . Use market price because the selling d. There is no transfer price possible in this division is operating with excess capacity case since X Co. would be better off buying the product from an outside supplier to question 14. Suppose Divisions S and B agree on a transfer price of $60. What is the benefit to division respectively? 600,000/S480,000 c. $480,000/$600,000 1.080,000/50 d. $0/$1,080,000

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