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Practice question-2 Dept. P & Q- Home Work-)-1 Methods 2 dept. A company has two departments Dept. P and Dept. Q. P sells goods to Q. Q completes the product and sell the finished product to the external customer for $25 per unit. Further information is as follows: Dept. P Dept-Q Number of units transferred/sold 5,000 Material Cost per unit $2 Labour Cost $1 $1 Other Variable costs per unit $1.5 Annual Fixed costs $30,000 $20,000 a) Required: i) Calculate Transfer Price based on Marginal Cost + 15% ii) Calculate the budgeted annual profit for division P and Q and for Company as a whole. iii) Evaluate both profits from the prospective of individual divisions and company as a whole. AAF-SEM-V-ADVANCED MANAGERIAL ACCOUNTING-LECTURE 3 5,000 $4 Practice question:2 - For Students b) Required: i) Calculate Transfer Price based on Full Cost + 10% ii) Calculate the budgeted annual profit for division P and Q and for Company as a whole. iii)Evaluate both profits from the prospective of individual divisions and company as a whole. AAF-SEM-V-ADVANCED MANAGERIAL ACCOUNTING-LECTURE 3