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mattfury17 mattfury17
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A month ago
Warner Company produces flash drives. The Custom division would like to buy 1,000,000 units from the Thumb Drive division, which currently has sufficient excess capacity. The units are normally sold for $9.99. The Thumb Drive division's variable production cost per unit is $2.10, variable selling and administrative expenses are $0.80 and fixed cost per unit are $1.65. The drives could be purchased from another company for $9.75. Both the Thumb Drive and the Custom divisions are operated as profit centers. If the company choses to use a cost-plus-based transfer price based on variable cost for the drives, what transfer price would the company use assuming a 50% markup?

▸ $9.75

▸ $4.55

▸ $4.35

▸ $6.83
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Managerial Accounting

Managerial Accounting


Edition: 4th
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micapiromicapiro
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A month ago
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More solutions for this book are available here
$4.35

($2.10 + $0.80) × 150% = $4.35
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mattfury17 Author
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A month ago
Brilliant ツ
Jadakiss
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Yesterday
I appreciate what you did here, answered it right Smiling Face with Open Mouth
jblazah
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2 hours ago
Thanks for your help!!
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