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Vira Company has two divisions, Pulp Division and Carton Division. Carton Division would like to buy 15,000 tons of pulp from Pulp Division. Currently, Pulp
Vira Company has two divisions, Pulp Division and Carton Division. Carton Division would like to buy 15,000 tons of pulp from Pulp Division. Currently, Pulp Division is operating at full capacity and is making 50,000 tons of pulp per month. Costs of pulp are as follows: Variable costs $47 per ton Fixed costs $20 per ton The company uses a cost-based transfer pricing and its policy is to set a transfer price of pulp at a 17% markup to the pulp's full costs. Q) Based on the company's policy, what is the price per ton that the Pulp Division should charge the Carton Division? (Do not round intermediate calculations. Round the final numbers to two decimal places.) A) $ per ton Lanee, Inc. manufactures and sells one product. The following information pertains to each of the company's first two years of operations: $200 Selling price per unit Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expense Fixed costs per year: Fixed manufacturing overhead Selling and administrative expense $86 $40 $11 $5 $49,000 $79,500 Year Production (units) Sales (units) 5,000 4,500 2 4,600 5,100 Q) What is net operating income under absorption costing in Year 2? (Do not round intermediate calculations. Round the final answer to the nearest dollars.) A) $
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