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Author Question: Timekeeper Corporation has two divisions, Distribution and Manufacturing. The company's primary ... (Read 38 times)

erika

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Timekeeper Corporation has two divisions, Distribution and Manufacturing. The company's primary product is high-end watches. Each division's costs are provided below:

Manufacturing:Variable costs per unit$2.45
Fixed costs per unit$9.04
Distribution:Variable costs per unit$0.60
Fixed costs per unit$1.20

The Distribution Division has been operating at a capacity of 4,010,000 units a week and usually purchases 2,005,000 units from the Manufacturing Division and 2,005,000 units from other suppliers at $15.00 per unit.

What is the transfer price per watch from the Manufacturing Division to the Distribution Division, assuming the method used to place a value on each transfer is 125% of full costs?
◦ $11.49
◦ $14.36
◦ $15.00
◦ $19.25


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Marked as best answer by erika on Mar 6, 2021

Ptupou85

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erika

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Reply 2 on: Mar 6, 2021
Thanks for the timely response, appreciate it


amit

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Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

 

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