The Lumber Division of Sheridan Company produces and sells lumber that can be sold to outside...
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The Lumber Division of Sheridan Company produces and sells lumber that can be sold to outside customers or within the company to the Construction Division. The following data have been gathered for the coming period: Lumber Division: Capacity Selling price per board foot Variable production cost per bd. ft. Variable selling cost per bd. it. Construction Division: Board feet needed Outside price paid per bd. ft. 250000 board feet $4.50 $1.25 $0.50 45000 $3.00 If the Lumber Division sells to the Construction Division, $0.35 per board foot can be saved in shipping costs. If current outside sales are 130000 board feet, what is the minimum transfer price that the Lumber Division should accept? The Lumber Division of Sheridan Company produces and sells lumber that can be sold to outside customers or within the company to the Construction Division. The following data have been gathered for the coming period: Lumber Division: Capacity Selling price per board foot Variable production cost per bd. ft. Variable selling cost per bd. it. Construction Division: Board feet needed Outside price paid per bd. ft. 250000 board feet $4.50 $1.25 $0.50 45000 $3.00 If the Lumber Division sells to the Construction Division, $0.35 per board foot can be saved in shipping costs. If current outside sales are 130000 board feet, what is the minimum transfer price that the Lumber Division should accept?
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Related Book For
Advanced Financial Accounting
ISBN: 978-0137030385
6th edition
Authors: Thomas Beechy, Umashanker Trivedi, Kenneth MacAulay
Posted Date:
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