[mdhashim]

And if there is spare capacity we should only consider the marginal cost of production right ? Or if there is any selling and distribution involved we should deduct the cost saved from the marginal cost ???

[mdhashim]

Thank you John..I appreciate your reply
I have some confusion hope you don’t mind clearing it
The maximum transfer price if no other alternative market is available is the price what the supplying division charges to the external sales -any savings that is made on packing or delivery am I Right? And how did you get 14.50 could you please explain me that ?and are all other working in my first question correct…I hope you don’t mind John..like asking questions related to this again and again ??

[mdhashim]

Thank you John for your reply I appreciate it…the thing is the value of the non current asset given in the question are net book value at the end of the year, so my doubt is aren’t they already charged with depreciation in order to arrive to that figure ?

[mdhashim]

4)what exactly to do when they ask average capital employed like is it adding the capital employed at the beginning of the year and the capital employed at the end if the year and dividing it by two
Thanking you in advance

[mdhashim]

Thank you john for your reply I really appreciate it. I have some doubts regarding the answer I would be really greatfull if you clear it out to me
1) why can’t we calculate roi for the year 2012?
2)there were new non current assets purchases in both the year is it already included in the capital employed given in the sum or should we add that ?
3) should we deduct the depreciation from the operating cash flow in order to arrive to the profit figure to be included in the ROI . And why did you deduct 10% from 5520 like it’s a current asset , right ?
Please help me with these questions
Thank you

[mdhashim]

Thank you john for your reply I really appreciate it. I have some doubts regarding the answer I would be really greatfull if you clear it out to me
1) why can’t we calculate roi for the year 2012?
2)there were new non current assets purchases in both the year is it already included in the capital employed given in the sum or should we add that ?
3) should we deduct the depreciation from the operating cash flow in order to arrive to the profit figure to be included in the ROI . And why did you deduct 10% from 5520 like it’s a current asset , right ?
4)what exactly to do when they ask average capital employed like is it adding the capital employed at the beginning of the year and the capital employed at the end if the year and dividing it by two
Thanking you in advance

[mdhashim]

Mike here the total revenue in the tb is $213,500 and the cost if sales is $136,800 .now as per the adjustment after considering the goods sold in return basis the revenue will be $211,500 and the cost of sales $135,518.please correct me if I’m wrong
Thank you mike ?

[mdhashim]

Sorry Mike the cost of goods sold are $4.8m
I’m really sorry,just a day left for exam right so a bit you know ?

[mdhashim]

Hello Mike
I didn’t understand why you debited with 16.2, I didn’t get the logic behind that . please do explain me about that
Thank you

[mdhashim]

Hello Mike,could you please explain about the figure to be shown in the statement of profit and loss as in the income tax
Like I didn’t get the logic behind adding 3200 and 3700 in there please Mike help me out with this

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