chapter 22 question 7.. 2 part

QS 22-16B Determining transfer prices without excess capacity LO C2 The Windshield division of Fast Car Co. makes windshields for use in Fast Car's Assembly division. The Windshield division incurs variable costs of $260 per windshield and has capacity to make 560,000 windshields per year. The market price is $490 per windshield. The Windshield division incurs total fixed costs of $3,200,000 per year. If the Windshield division is operating at full capacity, what transfer price should be used on transfers between the Windshield and Assembly divisions? Transfer price per windshield A company purchases a 11,440-square-foot commercial building for $330,000 and spends an additional $62,000 to divide the space into two separate rental units and prepare it for rent. Unit A, which has the desirable location on the corner and contains 2.340 square feet, will be rented for $1.50 per square foot. Unit B contains 9,100 square feet and will be rented for $0.90 per square foot. How much of the joint cost should be assigned to Unit B using the value basis of allocation? Market Value Percent of Market Value Joint Cost Apportioned Cost Numerator Denominator % of Mkt Value Unit A Unit B Totals 0.00%