EAS LO 9.4 Assume you are the department B manager for Marley's Manufacturing. Marley's operates under...

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EAS LO 9.4 Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation. (Hint It may be helpful to perform a vertical analysis.) Sales Cost of goods sold Gross profit MARLEY'S MANUFACTURING Income Statement Month Ending August 31, 2018 Utility expenses Wages expense Costs allocated from corporate Total expenses Operating income/(loss) $ Operating income/(loss) % Dept A $22,000 10,560 $11,440 1,000 5,500 2,200 $ 8,700 ? ? Dept B $51,000 26,520 $24,480 3,200 10,200 15.000 $28,400 ? EA6 LO 9.4 As manager of department B in Marley's Manufacturing, based on the costs you identified in the previous exercise for further research, how does this impact the financial performance of your department, and what might be some questions you want to ask or solutions you might propose to Marley's management? EA7 LO 9.4 Based on your research of the market in the previous exercises, you have determined the market price for the items your department purchase is 15% below what you are being charged by department A of Marley's Manufacturing. How would you view this as a manager? What steps could you take to solve this discrepancy? What alternatives would you consider, assuming you had control over purchasing decisions? EA8 LO 9.4 Using the information in the previous exercises about Marley's Manufacturing, determine the operating income for department B, assuming department A "sold" department B 1,000 units during the month and department A reduces the selling price to the market price. EAS LO 9.4 Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation. (Hint It may be helpful to perform a vertical analysis.) Sales Cost of goods sold Gross profit MARLEY'S MANUFACTURING Income Statement Month Ending August 31, 2018 Utility expenses Wages expense Costs allocated from corporate Total expenses Operating income/(loss) $ Operating income/(loss) % Dept A $22,000 10,560 $11,440 1,000 5,500 2,200 $ 8,700 ? ? Dept B $51,000 26,520 $24,480 3,200 10,200 15.000 $28,400 ? EA6 LO 9.4 As manager of department B in Marley's Manufacturing, based on the costs you identified in the previous exercise for further research, how does this impact the financial performance of your department, and what might be some questions you want to ask or solutions you might propose to Marley's management? EA7 LO 9.4 Based on your research of the market in the previous exercises, you have determined the market price for the items your department purchase is 15% below what you are being charged by department A of Marley's Manufacturing. How would you view this as a manager? What steps could you take to solve this discrepancy? What alternatives would you consider, assuming you had control over purchasing decisions? EA8 LO 9.4 Using the information in the previous exercises about Marley's Manufacturing, determine the operating income for department B, assuming department A "sold" department B 1,000 units during the month and department A reduces the selling price to the market price.