Chocfix produces hot cocoa mix. The company has two divisions, each operating as a profit center....
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Chocfix produces hot cocoa mix. The company has two divisions, each operating as a profit center. The transportation division purchases raw cocoa in the Ivory Coast and transports it to the mixing division in Atlanta, Georgia. The mixing division processes the raw cocoa into the cocos mix. It takes two pounds of raw cocoa to yield one pound of cocoa mix. Variable and fixed costs per pound of raw cocoa in the transportation division and variable and faed costs per pound of cocoa mix in the mixing division area as follows: (Click the icon to view the data) The market price for a pound of raw cocoa supplied to the mixing division in Alana is $14. Choix can sell each pound of hot cocoa mix for $42. Read the requirements Requirement 1, What are the minimum and maximum transfer prices per pound of raw cocos transported to the mixing division at which both divisions are willing to transact with each other? Assume the transportation division has unused capacity to transport raw cocoa to the mixing division Minimum transfer price Maximum transfer price Requirement 2. Refer to your answer in requirement 1. The management of Chocfix is trying to decide on the specific transfer price within the bounds identified in requirement 1. James Ladell Chocfic's CEO is suggesting to spilt the difference between the maximum and the minimum transfer price evenly. What is the transfer price under this scenario? What is the contribution margin per pound of raw cocoa for the transportation division? What is the contribution margin per pound of cocoa mix for the mixing division? What is the transfer price under this scenario? (Round your answer to the nearest XXXX) Under this scenario, the transfer price Requirements 1. What are the minimum and maximum transfer prices per pound of raw cocoa transported to the mixing division at which both divisions are willing to transact with each other? Assume the transportation division has unused capacity to transport raw cocoa to the mixing division 2. Refer to your answer in requirement 1. The management of Chocfix is trying to decide on the specific transfer price within the bounds identified in requirement 1. James Ladel Chocfac's CEO, is suggesting to split the difference between the maximum and the minimum transfer price evenly. What is the transfer price under this scenario? What is the contribution margin per pound of raw cocoa for the transportation division? What is the contribution margin per pound of cocoa mix for the mixing division? 3. Leila Brown, Chocfix's CFO, disagrees with James Ladel's suggestion to split the difference evenly. She argues that the difference between the maximum and minimum transfer price should be prorated based on the value of the work contributed by each of the divisions to the final product a. What is the value of the work contributed by each of the divisions towards a pound of cocoa mix? Ignore fixed costs b. What is the transfer price if the difference between the maximum and the minimum transfer price (identified in requirement 1) is prorated based on the relative value of the work contributed by each of the divisions (identified in requirement 3aj? What is the contribution margin per pound of raw cocoa for the transportation division? What is the contribution margin per pound of cocoa mix for the mixing division? e. Which transfer price, the one identified in requirement 2 or the one identified in requirement 3b, do you think Chocfix should use? Print Done Chocfix produces hot cocoa mix. The company has two divisions, each operating as a profit center. The transportation division purchases raw cocoa in the Ivory Coast and transports it to the mixing division in Atlanta, Georgia. The mixing division processes the raw cocoa into the cocoa mix. It takes two pounds of raw cocoa to yield one pound of cocoa mix. Variable and fixed costs per pound of raw cocoa in the transportation division and variable and fixed costs per pound of cocoa mix in the mixing division area as follows: (Click the icon to view the data.) The market price for a pound of raw cocos supplied to the mixing division in Atlanta is $14. Chocfix can sell each pound of hot cocoa mix for $42 Read the requirements Requirement 1. What are the minimum and maximum transfer prices per pound of raw cocoa transported to the mixing division at which both divisions are willing to transact with each other? Assume the transportation division has unused capacity to transport raw cocoa to the mixing division. Minimum transfer price Maximum transfer price 14 Requirement 2. Refer to your answer in requirement 1. The management of Chocfix is trying to decide on the specific transfer price within the bounds identified in requirement 1. James Ladell, Chocfic's CEO, is suggesting to split the difference between the maximum and the minimum transfer price evenly. What is the transfer price under this scenario? What is the contribution margin per pound of raw cocoa for the transportation division? What is the contribution margin per pound of cocoa mix for the mixing division? What is the transfer price under this scenario? (Round your answer to the nearest cent, XXXX) Under this scenario, the transfer price Data table Transportation Division Price per pound of raw cocoa supplied in the Ivory Coast Variable transportation costs per pound of raw cocoa Fixed transportation costs per pound of raw cocos Mixing Division Variable mixing costs per pound of cocoa mix Fixed mixing costs per pound of cocoa mix Print Done S 10 $ 1 $ 1 $ $ 4 X Chocfix produces hot cocoa mix. The company has two divisions, each operating as a profit center. The transportation division purchases raw cocoa in the Ivory Coast and transports it to the mixing division in Atlanta, Georgia. The mixing division processes the raw cocoa into the cocos mix. It takes two pounds of raw cocoa to yield one pound of cocoa mix. Variable and fixed costs per pound of raw cocoa in the transportation division and variable and faed costs per pound of cocoa mix in the mixing division area as follows: (Click the icon to view the data) The market price for a pound of raw cocoa supplied to the mixing division in Alana is $14. Choix can sell each pound of hot cocoa mix for $42. Read the requirements Requirement 1, What are the minimum and maximum transfer prices per pound of raw cocos transported to the mixing division at which both divisions are willing to transact with each other? Assume the transportation division has unused capacity to transport raw cocoa to the mixing division Minimum transfer price Maximum transfer price Requirement 2. Refer to your answer in requirement 1. The management of Chocfix is trying to decide on the specific transfer price within the bounds identified in requirement 1. James Ladell Chocfic's CEO is suggesting to spilt the difference between the maximum and the minimum transfer price evenly. What is the transfer price under this scenario? What is the contribution margin per pound of raw cocoa for the transportation division? What is the contribution margin per pound of cocoa mix for the mixing division? What is the transfer price under this scenario? (Round your answer to the nearest XXXX) Under this scenario, the transfer price Requirements 1. What are the minimum and maximum transfer prices per pound of raw cocoa transported to the mixing division at which both divisions are willing to transact with each other? Assume the transportation division has unused capacity to transport raw cocoa to the mixing division 2. Refer to your answer in requirement 1. The management of Chocfix is trying to decide on the specific transfer price within the bounds identified in requirement 1. James Ladel Chocfac's CEO, is suggesting to split the difference between the maximum and the minimum transfer price evenly. What is the transfer price under this scenario? What is the contribution margin per pound of raw cocoa for the transportation division? What is the contribution margin per pound of cocoa mix for the mixing division? 3. Leila Brown, Chocfix's CFO, disagrees with James Ladel's suggestion to split the difference evenly. She argues that the difference between the maximum and minimum transfer price should be prorated based on the value of the work contributed by each of the divisions to the final product a. What is the value of the work contributed by each of the divisions towards a pound of cocoa mix? Ignore fixed costs b. What is the transfer price if the difference between the maximum and the minimum transfer price (identified in requirement 1) is prorated based on the relative value of the work contributed by each of the divisions (identified in requirement 3aj? What is the contribution margin per pound of raw cocoa for the transportation division? What is the contribution margin per pound of cocoa mix for the mixing division? e. Which transfer price, the one identified in requirement 2 or the one identified in requirement 3b, do you think Chocfix should use? Print Done Chocfix produces hot cocoa mix. The company has two divisions, each operating as a profit center. The transportation division purchases raw cocoa in the Ivory Coast and transports it to the mixing division in Atlanta, Georgia. The mixing division processes the raw cocoa into the cocoa mix. It takes two pounds of raw cocoa to yield one pound of cocoa mix. Variable and fixed costs per pound of raw cocoa in the transportation division and variable and fixed costs per pound of cocoa mix in the mixing division area as follows: (Click the icon to view the data.) The market price for a pound of raw cocos supplied to the mixing division in Atlanta is $14. Chocfix can sell each pound of hot cocoa mix for $42 Read the requirements Requirement 1. What are the minimum and maximum transfer prices per pound of raw cocoa transported to the mixing division at which both divisions are willing to transact with each other? Assume the transportation division has unused capacity to transport raw cocoa to the mixing division. Minimum transfer price Maximum transfer price 14 Requirement 2. Refer to your answer in requirement 1. The management of Chocfix is trying to decide on the specific transfer price within the bounds identified in requirement 1. James Ladell, Chocfic's CEO, is suggesting to split the difference between the maximum and the minimum transfer price evenly. What is the transfer price under this scenario? What is the contribution margin per pound of raw cocoa for the transportation division? What is the contribution margin per pound of cocoa mix for the mixing division? What is the transfer price under this scenario? (Round your answer to the nearest cent, XXXX) Under this scenario, the transfer price Data table Transportation Division Price per pound of raw cocoa supplied in the Ivory Coast Variable transportation costs per pound of raw cocoa Fixed transportation costs per pound of raw cocos Mixing Division Variable mixing costs per pound of cocoa mix Fixed mixing costs per pound of cocoa mix Print Done S 10 $ 1 $ 1 $ $ 4 X
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