Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The company has another division A delivering two units of a component A required by division B for the production of one unit of product
The company has another division A delivering two units of a component A required by division B for the production of one unit of product B which is sold to external clients. Controlling department implemented a dual pricing system (as shown in the figure below) respectively. Not all information has been provided (as some cells are blank). based on transfer prices calculated by applying cost plus method and resale price method, e) Please fill the missing cells of the provided figure (transfer prices and costs/ revenues). Remark: Please ensure that not provided values are derived transparently. Division A Division B Preliminary production 2 A/ unit B (A) End production (B) V= per unit A V = 2 per unit A Division B Division A Corporate Centre Revenue 220,- Costs Revenue Costs (of Division A) Profit I Profit-/Loss- Assignment Profit Revenue (of Division B) Costs -100,-- Costs of Component A Profit Profit I Proft-Loss- Profit-Loss- -10.- -10.- Assignment Assignment +10,- Profit 0,- Profit +10,- Transfer price v, is calculated applying resale price method Transfer price v; is calculated applying cost plus method All costs of division B except the cost of the delivery of the component A
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started