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Could you tell me, the differences between service and manufacturing industries, do we have to learn the key words or could we know the meaning and discuss it?
and…..Question 4, Landual lamps the division 1 is split into two, housing and electrical and division 2 is called assembly.
The housing division can only transfer goods internally to the assembly division as there is no external market for it. in part C,it becomes a cost centre, why does it not have any revenue, is it because it has become a cost centre or is it because is cannot sell externally?
thanks
JemmaI know that the revenue wont come externally, but why do we not show the transfer price in the break down per division, is it because it becomes a cost centre?
Service v manufacturing: heterogeneity, instant, no transfer of goods, nothing tangible, cannot be stored.
With regards to the second division, the housing components division has no external market and is being asked to transfer to the assembly division at full cost. Therefore it has no opportunity to make profits.
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