materials used by the Multinomah Division of Isbister Company are currently purchased from outside suppliers at $120 per unit. These same materials are produced by the Pembroke Division. The Pembroke Division can produce the materials needed by the Multinomah Division at a variable cost of $60 per unit. The division is currently producing 161,000 units and has capacity of 230,000 units. The two divisions have recently negotiated a transfer price of $85 per unit for 69,000 units. By how much will each division's income increase as a result of this transfer? Pembroke Division $fill in the blank 1 Multinomah Division $fill in the blank 2
materials used by the Multinomah Division of Isbister Company are currently purchased from outside suppliers at $120 per unit. These same materials are produced by the Pembroke Division. The Pembroke Division can produce the materials needed by the Multinomah Division at a variable cost of $60 per unit. The division is currently producing 161,000 units and has capacity of 230,000 units. The two divisions have recently negotiated a transfer price of $85 per unit for 69,000 units. By how much will each division's income increase as a result of this transfer? Pembroke Division $fill in the blank 1 Multinomah Division $fill in the blank 2
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter10: Evaluating Decentralized Operations
Section: Chapter Questions
Problem 17E: Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside...
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The materials used by the Multinomah Division of Isbister Company are currently purchased from outside suppliers at $120 per unit. These same materials are produced by the Pembroke Division. The Pembroke Division can produce the materials needed by the Multinomah Division at a variable cost of $60 per unit. The division is currently producing 161,000 units and has capacity of 230,000 units. The two divisions have recently negotiated a transfer price of $85 per unit for 69,000 units.
By how much will each division's income increase as a result of this transfer?
| Pembroke Division | $fill in the blank 1 |
| Multinomah Division | $fill in the blank 2 |
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