The Variable Cost of Part X Is $50 Per Unit

question 147

Multiple Choice

The variable cost of Part X is $50 per unit and the full cost of the part is $80 per unit.The part is produced in Country Z and transferred to a plant in Country B.Country Z has a 10% income tax rate.Country B has a 50% income tax rate and an import duty equal to 10% of the price of the item.Part X can be transferred at full cost or variable cost.Assume Part X is transferred at full cost.By using full cost instead of variable cost for the transfer price,the income tax effect per unit in Country B is ________.

• A) a decrease in tax by $9 per unit
• B) an increase in tax by $9 per unit
• C) a decrease in tax by $15 per unit
• D) an increase in tax by $15 per unit

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Definitions:

Prestige Level

A measure of the societal respect, recognition, and admiration that is associated with a particular occupation or position.

Career Intervention

A strategic approach aimed at helping individuals make informed educational, career, and employment decisions and manage their careers effectively.

Gottfredson's Theory

A theory developed by Linda Gottfredson that outlines how individuals develop their career aspirations and make career choices, heavily influenced by their perception of social acceptability and their cognitive ability.

Stages

Series of steps that individuals typically go through in constructing a career, though not everyone progresses through these stages in the same manner or at fixed ages.