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Wildhorse Industries is a decentralized firm. It has two production centres: Vancouver and Kamloops. Each one is evaluated based on its return on investment.
Wildhorse Industries is a decentralized firm. It has two production centres: Vancouver and Kamloops. Each one is evaluated based on its return on investment. Vancouver has the capacity to manufacture 320,000 units of component TR222. Vancouver's variable costs are $150 per unit. Kamloops uses component TR222 in one of its products. Kamloops adds $90 of variable costs to the component and sells the final product for $460. Consider the following independent situations: Your answer is correct. Vancouver can sell all 320,000 units of TR222 on the open market at a price of $250 per unit. Kamloops is willing to buy 32,000 of those units. What should the transfer price be? Transfer price $ eTextbook and Media Your answer is correct. 250 per unit Of the 320,000 units of component TR222 it can produce, Vancouver can sell 224,000 units on the open market at a price of $250 per unit. Kamloops is willing to buy an additional 32,000 units. What should the minimum transfer price be? Minimum transfer price $ eTextbook and Media Your answer is incorrect. 150 per unit Of the 320,000 units of component TR222 it can produce, Vancouver can sell 256,000 units on the open market at a price of $250 per unit. Kamloops is willing to buy an additional 96,000 units. What should the transfer price be? (Round answer to 2 decimal places, e.g. 52.75.) Transfer price $ 160.42 per unit
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