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Bodge co has 2 divisions, Pottery and Painting.Pottery division. The pottery division makes unglazed bowls that are then sold to Painting division for decoration and glazing.
The painting division sells completed bowls to the market for $50 each after incurring variable costs.The pottery division has a fixed contract to sell 800 unglazed bowls each month for $30 each.The following monthly info is available for the pottery division
——————————————————EX————-Sales to Painting division(internal sales)
Sales revenue (30*800)—————-24000Sales revenue (25*1000)———————————————25000
Variable costs—————————–(12000———————(15000)
Fixed costs———————————(4000)———————-(4500)
Profit——————————————8000———————5500
Total profit of pottery division will be 8000+5500=13500
The Painting division has been offered to source the unglazed bowls from an external supplier for $24 each
If Pottery division sells to paintaing division @ 24$ then
——————————————————EX————-Sales to Painting division(internal sales)
Sales revenue (30*800)—————-24000Sales revenue (24*1000)———————————————24000
Variable costs—————————–(12000)———————(15000)
Fixed costs———————————(4000)———————-(4500)
Profit——————————————8000————————4500
Total profit of pottery division if sells @24$=8000+4500=12500
the question says “what will be the monthly drop in the profit of the pottery division so
13500-12500=1000$ whty in the answer has been showen 10000$does total profit of Pottery division have to be profil from external sales and profit from internal sales?so i find the difference but the answer shows 10000$ not 1000$?
this is the extra question I would like to know for analysis
is total sales of Pottery division together to internally and externally 1800 units?
is the variable cost per unit of Pottery division 15$ (12000$/800)?
when i also divided internal sales variable cost 15000$ into 1000 units it also gives me 15$ so it is (15000/1000)=15$?
By looking at External sales and internal sales fixed cost it is different why it is also different?is this variety derives from difference between units?
Sorry, but I do not have the time to work through all of this.
Do you not have an answer in the same book in which you found the question? If it is in the BPP Revision Kit or is a past exam question then do not copy them out (because they are copyright) but just say which question.
Dear Tutor, it is multiplie choice question and what i calculated is not showen in the answwer.
I can write the answer but if you want.
Dear tutor, Everytime you say I can not work all of them but i worked all of them to make your work easy and not to give hardship.There are some areas i would like to make them strong but everytime i face the same answer.
Tell me which exam the question appeared in, or the number of the question in the BPP Revision Kit.
Dear Tutor, I see you are not answering others like mine. They ask whatever question but you say you want individual tutor in my prior shred.I can show you several times longger questions that you helped but when it comes to me you say i do not have time. I know you help others i know it is free of charge i know how you help us but I am also here for learning. Anyway.this question has been taken from kaplan.I do not anymore for explanation and will not put and ask anything.
I do not have the Kaplan books – only the BPP Revision Kit.
I have answered an enormous number of your questions, probably more than any other student using this website.
Try to appreciate that we are doing this free of charge but that we need time to actually do our normal work where we actually earn money so as to be able to live!! 🙂
I spend upwards of four hours a day answering questions. I do need to sleep and I do need to go to my normal work.
Again, if you want private tuition then I am sure that there are tuition providers in whichever country you live, who will be happy to provide it.
Do certainly continue asking questions provided that they relate to my lectures or to past exam questions, but as far as past exam questions are concerned please restrict yourself to asking about what you do not understand in the examiners answer – do not expect me to comment on different approaches. If they arrive at the same answer then that is fine, and doesn’t need a comment from me. If they arrive at a different answer then obviously they are wrong and so then by all means ask.
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