Answer:
The Parts Division of Nydron Corporation
The Transfer Price for this transaction would lie between $16.85 and $17.00.
Relevant costs of making Part Y6P per unit is computed as the variable or marginal costs:
Sales Price to outside companies = $17
Buying Price from outside supplier = $16.85
Marginal Costs:
Direct Materials $7
Direct Labor $3
Var. Mfg O/H $4.50
Total Variable = $14.50
Fixed Costs = $1.20
Total costs = $15.20
Explanation:
This is a Transfer Price decision, in a buy or make situation. In making such decision, management of Nydron Corporation should concentrate on the relevant costs and the lowest and higher transfer prices. The costs that are relevant in this decision are those that can be avoided, called avoidable costs. They make the difference in making choices.
Since the relevant costs equal $14.50 (without the fixed cost of $1.20, which must be incurred irrespective of the decision taken) and the part can be sold for $17.00 to outside buyers, the transfer price would lie within the relevant manufacturing cost and the outside selling price. However, since the part can be bought from outside at $16.85, this becomes the lowest transfer price and $17.00 the highest transfer price.
Transfer price is the price that a division can sell its products or services to another division of the company and between subsidiaries and parent companies. Transfer pricing is an accounting and taxation practice that enables prices to be set for transactions done internally within businesses and between subsidiaries that operate under common control or ownership. The transfer pricing practice extends to cross-border transactions as well as domestic ones, and have taxation implications.
Answer:
Producer price index
Explanation:
Producer price index is used as an economic indicators which indicates the fluctuations in the price level in an economy. It is the leading indicator for the consumer price index.
Producer price index refers to the price index which measures the change in the average price received by the producers for their output over a specified period of time.
The producer price index doesn't takes into account the effect of indirect taxes but wholesale price index takes the effect of indirect taxes.
It is calculated as follows:
PPI = (Current prices received by sellers ÷ Base year prices) × 100
Answer:
a. positive, so Joan considers hamburger to be an inferior good.
Explanation:
Income elasticity is a microeconomic concept that aims to measure the sensitivity of demand in the face of income changes. To calculate the Income elasticity , a formula is used that divides the observed percentage change in quantity (Q) by the percentage change in price income (P): Elasticity = ▲ Q / ▲ P
The percentage change in quantity (▲ Q) and the percentage change in price (▲ P) are calculated by the difference in quantity / price in the two periods divided by the quantity / price of the first period.
▲ Q = (60 -50/60) = 0,16
▲ Q = (40.000 - 30.000/40.000) = 0,25
Elasticity = ▲ Q / ▲ P = 0,16/0,25 = 0,64
Therefore, the elasticity is positive.
This good is considered inferior, because according to microeconomic theory, inferior goods are those whose demand increases when consumer income decreases. This is the opposite of the normal good, which has its demand increased when income increases.
Answer: Option C
Explanation: In simple words, telecommuting refers to the arrangement in which an employee of the organisation performer his or her job activities right from his or her home without going to a specified work place.
This is a modern times business technique which is used by organisations to save their costs like rent and travelling allowance to employees that they have to bear. Such arrangement is generally made for the jobs that requires no client dealings and have specified targets set.
Thus, from the above we can conclude that the company should go for telecommuting as it will save the man hours.
Answer:
It would be an example of advertising.
Explanation:
This is because Gabe's Granola Bars are giving coffee mugs with their logo at a grocery store, not their own location.
I hope this helped!
