Teslum Inc. has a number of divisions, including the Machina Division, a producer of high-end espresso makers, and the Java Division, a chain of coffee shops.
Machina Division produces the EXP-100 model espresso maker that can be used by Java Division to create various coffee drinks. The market price of the EXP-100 model is $950, and the full cost of the EXP-100 model is $475. Required:
1. If Teslum has a transfer pricing policy that requires transfer at full cost, what will the transfer price be?
2. If Teslum has a transfer pricing policy that requires transfer at market price, what would the transfer price be?
3. Now suppose that Teslum allows negotiated transfer pricing and that Machina Division can avoid $135 of selling expense by selling to Java Division.
What is the minimum transfer price?
What is the maximum transfer price?
Answers (1)
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Teslum Inc. has a number of divisions, including the Machina Division, a producer of high-end espresso makers, and the Java Division, a ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Which statements describe the role of risk in making investment decisions? Check all that apply. When discussing investments, "risk" is the possibility of little or no return. Risk is an element to consider when investing in stocks.
Answers (2)
A discouraged worker is one who:quits his/her job because the possibility of advancement was very low. dislikes the current job but is afraid to quit. is underqualified for the current job. is overqualified for the current job.
Answers (1)
The standard protocol for communication between a Web browser and a Web server is the web protocol. True False
Answers (1)
If marginal cost is above the average variable cost, then average variable cost is decreasing.
Answers (1)
A company issued 10-year, 9% bonds with a par value of $500,000 when the market rate was 9.5%. The company received $484,087 in cash proceeds.
Answers (1)
New Questions in Business
An oligopolistic market structure is distinguished by several characteristics, one of which is a difficult entry. Which of the following are other characteristics of this market structure? Check all that apply. a. Market control by many small firms.
Answers (1)
Who should you' alert that you are interviewing for jobs? A. Your references B. Other possible employers C. Your classmates D. Your present employer
Answers (1)
Common allocation bases are a. direct labor dollars, direct labor hours, and machine dollars b. machine dollars, direct labor dollars, and direct labor hours c. direct labor dollars, direct labor hours, and machine hours d.
Answers (1)
George and Weezy received $30,200 of Social Security benefits this year ($12,000 for George; $18,200 for Weezy). They also received $5,000 of interest from jointly owned City of Ranburne Bonds and dividend income.
Answers (1)
Which of the following is true regarding the high-tech industry today? a. It generally depends on a pool of low-skilled labor. b. It has led to the increased economic development of previously rural areas. c.
Answers (1)