Materials used by the Instrument Division of XPort Industries are currently purchased from outside suppliers at a cost of $341 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $283 per unit. a. If a transfer price of $310 per unit is established and 27,700 units of materials are transferred, with no reduction in the Components Division's current sales, how much would XPort Industries' total income from operations increase? b. How much would the Instrument Division's income from operations increase? c. How much would the Components Division's income from operations increase?
Q: divisions as an investment center. Division A is currently selling 30,000 units of Part X annually,…
A: The Transfer pricing are the price that is paid for goods or services transferred within the…
Q: Division A makes a part with the following characteristics: Production capacity in units- 15,000…
A: Note: As per general rule, in the case of sufficient capacity available, the minimum transfer price…
Q: Materials used by the Instrument Division of T_Kong Industries are currently purchased from outside…
A: Cost accounting is the branch of accounting that inspects the cost structure of a business. This…
Q: The Wood Division of Wildhorse Products Inc. manufactures wood mouldings and sells them externally…
A: Formula: Minimum transfer price = Variable cost + ( External selling price - variable cost )
Q: A company produces 300 microwave ovens per montn, each of WNich inciudes one electrical circuit. The…
A: in the given question company assume that the company could not reduce any fixed costs by…
Q: Ballantine Corp. produces and sells lead crystal glassware. The firm consists of two divisions,…
A: Transfer Pricing: This refers to a process of pricing in which one sub-unit of an organization…
Q: Your Division makes a part that can either be sold to outside customers or transferred internally to…
A: As per the general transfer pricing rule, in the case of sufficient capacity available, the minimum…
Q: Division A makes a part with the following characteristics: Production capacity in units- 15,000…
A: Contribution to Division A= Selling Price-Variable Cost Contribution to Division A=25-18= $7 per…
Q: Quest Motors, Inc., operates as a decentralized multidivision company. The Vivo division of Quest…
A: Describe the transfer pricing policy using the criteria of goal congruence, valuating division…
Q: Use this information for Jefferson Company to answer the question that follow. Materials used by…
A: When a product has been purchased from outsider and same can be made by one of our own division in…
Q: Bartolo Delivery has two divisions, air express and ground service, that share the common costs of…
A: Total cost = $8,100,000 Fixed cost =$5,670,000 Variable cost =$2,430,000
Q: Your Division makes a part that can either be sold to outside customers or transferred internally to…
A: As per the general transfer pricing rule, in the case of sufficient capacity available, the minimum…
Q: The Molding Division of Cotwold Company manufactures a plastic casing used by the Assembly Division.…
A: Net income is the income earned by the company. It is presented in the income statement of the…
Q: Ballantine Corp. produces and sells lead crystal glassware. The firm consists of two divisions,…
A: Whether the top management of B Corporation wants the C division to accept the offer and calculate…
Q: Wetherald Products, Incorporated, has a Pump Division that manufactures and sells a number of…
A: Minimum Acceptable Transfer Price :— It is the variable cost plus opportunity costs. If the…
Q: Materials used by the Instrument Division of Ziegler Inc. are currentlypurchased from outside…
A: Operating income can be defined as the sum total of profit of company after subtracting its regular…
Q: Your Division makes a part that can either be sold to outside customers or transferred internally to…
A: As per the general transfer pricing rule, in the case of sufficient capacity available, the minimum…
Q: The materials used by the North Division of Zhang Company are currently purchased from outside…
A: The increase in income is calculated as excess of earnings in the present condition as compared to…
Q: Mar Company has two decentralized divisions, X and Y. Division X has always purchased certain units…
A: Transfer price means the price charged by one department from another department for the goods or…
Q: Truball Inc., which manufactures sports equipment, consists of several operating divisions. Division…
A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…
Q: The materials used by the North Division of Horton Company are currently purchased from outside…
A: The transfer price is the price at which one department agrees to sell goods to another department…
Q: Avery Company has two divisions, Polk and Bishop. Polk produces an item that Bishop could use in its…
A: Solution a: Operating profit will increase by = (outside purchase price - variable cost per unit) *…
Q: The Wood Division of Swifty Corporation manufactures rubber moldings and sells them externally for…
A: CVP analysis is considered a decision-making tool that helps management to make strategies and take…
Q: The Parts Division of Ram Company produces units that can either be sold to outside customers or…
A: When in division accounting, each division is responsible for maintaining its profitability, the…
Q: Materials used by Square Yard Products Inc. in producing Division 3's product are currently…
A: Income statement forms a part of financial statements and are prepared to ascertain the…
Q: Division P of the Nyers Company makes a part that can either be sold to outside customers or…
A:
Q: Materials used by Best Bread Company in producing Division A's product are currently purchased from…
A: Following is the answer to given questions
Q: The Windshield division of Jaguar Company makes windshields for use in its Assembly division. The…
A: Note: As per general rule, in the case of sufficient capacity available, the minimum transfer price…
Q: The materials used by the North Division of Zhang Company are currently purchased from outside…
A: Introduction: Variable cost: Cost varies according to the level of production units. Costs cannot be…
Q: a. If a transfer price of $148 per unit is established and 50,000 units of materials are…
A: Operations income:- Operations income/Operating income is that income that a business gets after…
Q: The materials used by the North Division of Zhang Company are currently purchased from outside…
A: Transfer Pricing- Transfer price is a price on which two parties are agreed on transfer goods or…
Q: The Wood Division of Vaughn Manufacturing manufactures rubber moldings and sells them externally for…
A: Given, Variable cost is = $ 25 per unit Fixed cost is = $ 8 per unit Division to transfer = 4300…
Q: Materials used by Best Bread Company in producing Division A's product are currently purchased from…
A: "As per Bartleby guidelines, we will solve the first three questions for you. If you want any…
Q: pur Division makes a part that can either be sold to outside customers or transferred internally to…
A:
Q: Ballantine Corp. produces and sells lead crystal glassware. The firm consists of two divisions,…
A: In case of special order and if there is capacity constraint the oppurtunity cost along with…
Q: The Molding Division of Cotwold Company manufactures a plastic casing used by the Assembly Division.…
A: Transfer pricing methodology is used for setting prices at which products can be transferred from…
Q: Spark Ltd has two divisions, assembly and electrical. The assembly division transfers partially…
A: Transfer price basically implies the price that has been agreed upon between the departments for the…
Q: Division A makes a part with the following characteristics: Production capacity in units- 15,000…
A: Note: As per general rule, in the case of sufficient capacity available, the minimum transfer price…
Q: Materials used by Ford Company in producing Division A's product are currently purchased from…
A: Note: Since you have posted a question with multiple sub-parts, we will solve the first three…
Q: The materials used by the South Division of Eagle Company are currently purchased from outside…
A: North Division’s operating income per unit on internal transfer = Transfer price - Variable cost =…
Q: materials used by the Multinomah Division of Isbister Company are currently purchased from outside…
A: Pembroke Division:::: (Transfer price --Variable Cost)*Units transferred ($85-60$)*69000…
Q: The materials used by the North Division of Zhang Company are currently purchased from outside…
A: Particulars Amount ($) Current Price per unit at which the units are bought from outside market…
Q: Division A makes a part with the following characteristics: Production capacity in units- 15,000…
A: Transfer price refers to the price that one division another division of the same company for a…
Q: 6. Materials used by the Instrument Division of XPort Industries are currently purchased from…
A: Internal transfer means where one independent department is transferring the goods to another…
Q: ll each division's income increase as a result of this transfer
A:
Q: The Windshield division of Jaguar Company makes windshields for use in its Assembly division. The…
A: Note: As per general rule, in the case of sufficient capacity available, the minimum transfer price…
Q: The materials used by the North Division of Zhang Company are currently purchased from outside…
A: Relevant costs are the costs that differ among the two alternatives that are being considered by a…
Q: Southwest Division offers its product to outside markets for $30. It incurs variable costs of $11…
A: Introduction: A variable cost is a business expense that varies according to how much a company…
Decision on Transfer Pricing
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 3 images
- Decision on Transfer Pricing Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $1,350 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $900 per unit. a. If a transfer price of $1,000 per unit is established and 75,000 units of materials are transferred, with no reduction in the Components Division's current sales, how much would Ziegler Inc.'s total operating income increase?$fill in the blank 1 b. How much would the Instrument Division's operating income increase?$fill in the blank 2 c. How much would the Components Division's operating income increase?$fill in the blank 3Decision on transfer pricing Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $447 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $371 per unit. Assume that a transfer price of $425 has been established and that 26,500 units of materials are transferred, with no reduction in the Components Division's current sales. a. How much would Ziegler Inc.'s total operating income increase? b. How much would the Instrument Division's operating income increase? C. How much would the Components Division's operating income increase? d. Any transfer price will cause the total income of the company to as long as the supplier division capacity is toward making materials for products that are ultimately sold to the outside.Decision on transfer pricing Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $389 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $323 per unit. a. If a transfer price of $354 per unit is established and 35,600 units of materials are transferred, with no reduction in the Components Division's current sales, how much would Ziegler Inc.'s total operating income increase? X $ b. How much would the Instrument Division's operating income increase? $ C. $ How much would the Components Division's operating income increase?
- Decision on Transfer Pricing Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $1,350 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $900 per unit. Assume that a transfer price of $1,200 has been established and that 75,000 units of materials are transferred, with no reduction in the Components Division's current sales. a. How much would Ziegler Inc.'s total operating income increase?$fill in the blank 1 b. How much would the Instrument Division's operating income increase?$fill in the blank 2 c. How much would the Components Division's operating income increase?$fill in the blank 3 d. Any transfer price will cause the total income of the company to , as long as the supplier division capacity is toward making materials for products that are…Decision on transfer pricing Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $316 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $262 per unit. a. If a transfer price of $288 per unit is established and 27,900 units of materials are transferred, with no reduction in the Components Division's current sales, how much would Ziegler Inc.'s total operating income increase? b. How much would the Instrument Division's operating income increase? $ C. How much would the Components Division's operating income increase?Decision on transfer pricing Materials used by the Instrument Division of XPort Industries are currently purchased from outside suppliers at a cost of $249 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $207 per unit. Assume that a transfer price of $237 has been established and that 25,200 units of materials are transferred, with no reduction in the Components Division’s current sales. a. How much would XPort Industries’ total income from operations increase?$fill in the blank 1 b. How much would the Instrument Division’s income from operations increase?$fill in the blank 2 c. How much would the Components Division’s income from operations increase?$fill in the blank 3 d. Any transfer price will cause the total income of the company to increase , as long as the supplier division capacity is used toward making…
- Decision on transfer pricing Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $359 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $298 per unit. Assume that a transfer price of $341 has been established and that 34,200 units of materials are transferred, with no reduction in the Components Division's current sales. a. How much would Ziegler Inc.'s total operating income increase? b. How much would the Instrument Division's operating income increase? c. How much would the Components Division's operating income increase?Decision on Transfer Pricing Materials used by the Instrument Division of XPort Industries are currently purchased from outside suppliers at a cost of $193 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $160 per unit. a. If a transfer price of $176 per unit is established and 27,900 units of materials are transferred, with no reduction in the Components Division's current sales, how much would XPort Industries’ total income from operations increase?$fill in the blank 1 b. How much would the Instrument Division’s income from operations increase?$fill in the blank 2 c. How much would the Components Division's income from operations increase?$fill in the blank 3Decision on Transfer Pricing Materials used by the Instrument Division of T Kong Industries are currently purchased from outside suppliers at a cost of $262 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $217 per unit. a. If a transfer price of $238 per unit is established and 46,700 units of materials are transferred, with no reduction in the Components Division's current sales, how much would T_Kong Industries' total income from operations increase? X b. How much would the Instrument Division's income from operations increase? c. How much would the Components Division's income from operations increase? X
- Decision on Transfer Pricing Materials used by the Instrument Division of T_Kong Industries are currently purchased from outside suppliers at a cost of $316 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $262 per unit. a. If a transfer price of $288 per unit is established and 42,400 units of materials are transferred, with no reduction in the Components Division’s current sales, how much would T_Kong Industries’ total income from operations increase? b. How much would the Instrument Division’s income from operations increase? c. How much would the Components Division’s income from operations increase?Decision on transfer pricing Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $299 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $248 per unit. Assume that a transfer price of $284 has been established and that 40,000 units of materials are transferred, with no reduction in the Components Division's current sales. a. How much would Ziegler Inc.'s total operating income increase? b. How much would the Instrument Division's operating income increase? c. How much would the Components Division's operating income increase? d. Any transfer price will cause the total income of the company to making materials for products that are ultimately sold to the outside. as long as the supplier division capacity is towardDecision on transfer pricing Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $375 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $311 per unit. Assume that a transfer price of $356 has been established and that 23,900 units of materials are transferred, with no reduction in the Components Division's current sales. a. How much would Ziegler Inc.'s total operating income increase? 770,000 X b. How much would the Instrument Division's operating income increase? 770,000 X How much would the Components Division's operating income increase? 770,000 X d. Any transfer price will cause the total income of the company to increase materials for products that are ultimately sold to the outside. X, as long as the supplier division capacity is used toward making