Find transfer price for the division A. Desired return on investment 28% Fixed assets=500,000 Current assets (other than debtors) 300,000 Debtors =200,000 Annual fixed cost of the division= 800,000 Variable cost per unit= 10 Budgeted volume of production in units= 400,000 The company fixes transfer prices on the basis of cost plus and estimated return on investment in its division.

Find transfer price for the division A. Desired return on investment 28% Fixed assets=500,000 Current assets (other than debtors) 300,000 Debtors =200,000 Annual fixed cost of the division= 800,000 Variable cost per unit= 10 Budgeted volume of production in units= 400,000 The company fixes transfer prices on the basis of cost plus and estimated return on investment in its division.

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter14: Decentralized Operations

Section: Chapter Questions

Problem 3SEQ: Division A of Kern Co. has sales of $350,000, cost of goods sold of $200,000, operating expenses of...

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