The Assembly Division of Hunter Valley Bicycles Company Has Offered

question 102

Essay

The Assembly Division of Hunter Valley Bicycles Company has offered to purchase 90 000 frames from the Frame Division for $170 per unit.At a normal volume of 250 000 frames per year,production costs per frame are as follows:
$$\begin{array} { | l | r| } \hline \text { Direct materials } & \$ 80 \\\hline \text { Direct manufacturing labour } & 40 \\\hline \text { Variable factory overhead } & 24 \\\hline \text { Fixed factory overhead } & \underline { 40 } \\\hline \text { Total } & \$ 184 \\\hline\end{array}$$
The Frame Division has been selling 250 000 frames per year to outside buyers at $230 each;capacity is
350 000 frames per year.The Assembly Division has been buying frames from outside sources for $225 each.
Required:
a.Should the Frame Division manager accept the offer? Explain.
b.From the company's perspective,will the internal sales be of any benefit? Explain.
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Understand the concepts of self-esteem, self-concept, and self-understanding in relation to identity development.

Articulate how perspective taking influences self-understanding from infancy through adolescence.

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Definitions:

Times Interest Earned Ratio

A financial metric that measures a company's ability to meet its interest payments on outstanding debt.

Operating Expenses

The ongoing costs for running a business, excluding the cost of goods sold, such as rent, utilities, and salaries.

Profitability

The ability of a business to generate earnings compared to its expenses and other relevant costs, expressed as a percentage or profit margin.

Short-term Notes Payable

Debt obligations that are due to be paid within a year, often used for working capital purposes or to finance short-term liabilities.