The Engine Division Provides Engines for the Tractor Division of a Company

question 30

Multiple Choice

The Engine Division provides engines for the Tractor Division of a company. The standard unit costs for Engine Division are as follows:
$$\begin{array} { l r } \text { Direct materals }&\$600 \\\text { Direct labour } & 1,200 \\\text { Variable overhead } & 300 \\\text { Fixed overhead } & 150 \\\text { Market price per unit } & 2,730\end{array}$$
-Refer to the figure.What is the best transfer price to avoid transfer price problems?

• A)$600
• B)$1,800
• C)$2,100
• D)$2,730

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Definitions:

Identical Twins

Twins that develop from a single fertilized egg and share exactly the same genetic material.

Biological Parents

The birth parents of an individual, providing the genetic material through reproduction.

Mental Ability

The capacity to perform cognitive tasks, understand complex ideas, solve problems, and learn from experience.

Variability

The degree to which data points in a statistical distribution or dataset differ from each other and from the overall mean.