Multinational transfer pricing, effect of alternative transfer-pricing methods, global income tax minimization. Tech Friendly Computer, Inc., with headquarters in San Francisco, manufactures and sells a desktop computer. Tech Friendly has three divisions, each of which is located in a different country: a. China division-manufactures memory devices and keyboards b. South Korea division assembles desktop computers using locally manufactured parts, along with memory devices and keyboards from the China division c. U.S. division-packages and distributes desktop computers Each division is run as a profit center. The costs for the work done in each division for a single desktop computer are as follows: China division: Variable cost = 900 yuan Fixed cost = 1,980 yuan South Korea division: Variable cost = 350,000 won Fixed cost = 470,000 won U.S. division: Variable cost = $125 Fixed cost = $325 Chinese income tax rate on the China division's operating income: 40% South Korean income tax rate on the South Korea division's operating income: 20% U.S. income tax rate on the U.S. division's operating income: 30% Each desktop computer is sold to retail outlets in the United States for $3,800. Assume that the current foreign exchange rates are as follows: 9 yuan = $1 U.S. 1,000 won = $1 U.S. Both the China and the South Korea divisions sell part of their production under a private label. The China division sells the comparable memory/keyboard package used in each Tech Friendly desktop computer to a Chinese manufacturer for 4,500 yuan. The South Korea division sells the comparable desktop computer to a South Korean distributor for 1,340,000 won.

Calculate the operating income of each division when all corporate costs are allocated based on revenues of each division.

Zachia Ltd provides the following data regarding its four product lines: Product Sales mix Weighted average contribution margin per unit (WACMU) Fixed costs Desired profit after tax w Y 60 20 15 $13.7 $71,000 $33,950 The corporate tax rate is 30% Required Calculate the number of units of Product X that must be sold in order to achieve the desired after-tax profit?

Please help me figure a-e

Blossom Company is considering two alternatives. Alternative A will have revenues of $145,100 and costs of $104,800. Alternative B will have revenues of $184,300 and costs of $121,900. Compare Alternative A to Alternative B showing incremental revenues, costs, and net income. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) Alternative A $ 145100 Revenues Costs Net Income 104800 40300 Alternative B Vis better than Alternative A Alternative B Net Income Increase (Decrease) 184300 $ 39200 i 121900 62400 17100 22100

Oriole Company is considering two alternatives. Alternative A will have revenues of $147,400 and costs of $103,400. Alternative B will have revenues of $188,200 and costs of $121,600. Compare Alternative A to Alternative B showing incremental revenues, costs, and net income. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Revenues $ Costs Alternative A Net Income $ ▾ is better than +A Alternative B Net Income Increase (Decrease) +A +A

Shirley Incorporated has three divisions, King, West and Gold. All common fixed costs are unavoidable. Following is the segmented income statement for the previous year: Sales revenue Variable costs Contribution margin Direct fixed costs Segment margin Common fixed costs (allocated) Net operating income (loss) King $ 1,040,000 312,000 $ 728,000 104,000 $ 624,000 391,000 $ 233,000 Required: a. What would Shirley's net income (loss) be if the West Division were dropped? b. What would Shirley's net income (loss) be if the Gold Division were dropped? Complete this question by entering your answers in the tabs below. Required A Required B What would Shirley's net income (loss) be if the West Division were dropped? Gold $426,000 251,340 $ 174,660 48.000 $ 126,660 159,375 $ (32,715) Total $ 2,048,000 889,260 $ 1,158,740 192,000 $ 966,740 763,000 $ 203,740

When the selling division is a full capacity, the goal congruent transfer price will be the: market price actual full cost actual variable cost standard full cost actual variable cost plus markup

Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 255,000 178,500 76,500 107,000 (30,500) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be eliminated?

Using the formula in the text, if the lowest acceptable transfer price from the viewpoint of the selling division is $95 and the opportunity cost per unit on outside sales is $38, then the variable cost per unit must be: