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Use the Following Information for the Next 2 Questions

question 67

Multiple Choice

Use the following information for the next 2 questions.
The Machining Division has a capacity of 2,000 units. Its sales and cost data are: Use the following information for the next 2 questions. The Machining Division has a capacity of 2,000 units. Its sales and cost data are:   -The Machining Division is currently selling 1,900 units to outside customers, and the Assembly Division wants to purchase 300 units from Machining. If the transaction takes place, the variable administrative costs per unit on the units transferred to Assembly will be $2/unit, not $5/unit. What should be the transfer price? A)  $73.67 B)  $76.67 C)  $97.00 D)  $100.00
-The Machining Division is currently selling 1,900 units to outside customers, and the Assembly Division wants to purchase 300 units from Machining. If the transaction takes place, the variable administrative costs per unit on the units transferred to Assembly will be $2/unit, not $5/unit. What should be the transfer price?


Definitions:

Currency

The system of money in general use in a particular country.

Dollar Rate

The exchange rate of the US dollar against other currencies, influencing international trade and economics.

Exchange

The process of trading one thing for another.

Net Exports

The value of a country's total exports minus its total imports, representing the contribution of trade to the national economy.

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