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Can you help me with how unsatisfied external demand was calculated ?

This topic has 1 reply, 2 voices, and was last updated 4 years ago by John Moffat.

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March 6, 2021 at 12:12 pm #613752
farhaanm
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Its from the technical article on transfer pricing:
unsatisfied external demand is ([$8,010,000/0.6] – $8,010,000) = $5,340,000
I don’t know whats being done in this part of the calculation.
[$8,010,000/0.6]
March 6, 2021 at 4:23 pm #613781
John Moffat
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Given that they are currently only satisfying 60% of the demand, the full demand must be 8,010,000 / 0.6, and the demand they are not satisfying at the moment is that less the 8,010,000 that they are currently satisfying.
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