Materials used by Ford Company in producing Division A's product are currently purchased from outside suppliers at a cost of $30 per unit. However, the same materials are available from Division B. Division B has unused capacity and can produce the materials needed by Division A at a variable cost of $20 per unit.

If the negotiated price approach is used, what would be the range of acceptable transfer prices? Round your answer to two decimal places.

The answers are not $20.00 or 30.00

Question

02-10-2022
Business

Answered

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Materials used by Ford Company in producing Division A's product are currently purchased from outside suppliers at a cost of $30 per unit. However, the same materials are available from Division B. Division B has unused capacity and can produce the materials needed by Division A at a variable cost of $20 per unit.

If the negotiated price approach is used, what would be the range of acceptable transfer prices? Round your answer to two decimal places.

The answers are not $20.00 or 30.00

Sagot :

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