[shing]

But Y is selling externally by earning $3 contribution per hour.

So, generally, i must consider about prioritize in maximize its own division(A) by charging another division(:)?

Means that I should use the highest contribution gained on any products (eg, X Y Z) produced by division A as my opportunity cost?

Am i right?

Thank You.

[shing]

For transfer pricing chapters.

If there is
external market price with no spare capacity- transfer price at Market price
No external market price with spare capacity- transfer price at marginal cost
No external market price with no spare capacity- transfer price at marginal cost+ Opportunity cost.

right? May i know the external market price means there is a 3rd party company selling the same product OR the company itself is selling its product to outsider?

Thanks

[shing]

Please see pg 128 (C) i only understand the expected value of variable cost. Beyond the calculation, i have no idea. Please explain further.

Thank You.

[shing]

Thank You.

Another question, please see page 127 from opentuition’s note (Practice Answer)

How do i get the total time of 20hr, 32 hr,51.2 hr ,81.9 hr and 131.072 hr? from batches 1-16.

what is overhead cost and how to i get variable OH amount in pg 127?

Thank You.

[shing]

Demand: 400 500 700 900
300 2900 3400 4400 5400
500 3500 4000 5000 5000
700 4100 4600 4600 4600
800 4400 4400 4400 4400

But still how do i get the bold figure? I still couldnt get 2900, 3400 and etc…

Please advice.

Thanks

[shing]

how come the p5 tips still havent update yet? its still june 2011.

[Author]

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