Question
The Engine Division provides engines for the Tractor Division of a company. The standard unit costs for the Engine Division are: Direct materials $700 Direct
The Engine Division provides engines for the Tractor Division of a company. The standard unit costs for the Engine Division are:
| Direct materials | $700 |
| Direct labor | 1,300 |
| Variable overhead | 400 |
| Fixed overhead | 200 |
| Market price per unit | 3,200 |
The Engine Division has excess capacity. What is the best transfer price to avoid transfer price problems?
a.$2,400
b.$900
c.$1,350
d.$300
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Curriculum Auditing
Authors: Fenwick W. English
1st Edition
0877625921, 978-0877625926
