Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The following information relates to Questions A5 to A6 Great Western Ceramics plc uses transfer prices between Production Division and Sales Division. The variable costs
The following information relates to Questions A5 to A6 Great Western Ceramics plc uses transfer prices between Production Division and Sales Division. The variable costs are 45 per unit for Production Division and 15 per unit for Sales for Sales Division. The selling price of the final product is 120 per unit and 15,000 units are Division. Apportioned fixed overheads are 25 per unit for Production Division and 20 per unit sold in total for a month. Question A5 (REQUIRED) Calculate the total profit or loss made by Sales Division for the month, if the transfers are made at full costs plus a mark-up of 10 per unit. (1 mark) Question A6 (REQUIRED) Calculate the total profit or loss made by Production Division for the month, if the transfers are made at variable costs and then the division is credited with pro-rata contribution determined with reference to variable costs. (2 marks)
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