The Nelson Company's radio division currently is purchasing transistors from the Charlotte Co.for $3.50 each.The total number of transistors needed is 8,000 per month.Nelson Company's electronics division can produce the transistors for a cost of $4.00 each and they have plenty of capacity to manufacture the units.The $4 is made up of $3.25 in variable costs,and $0.75 in allocated fixed costs.What should be the range of a possible transfer price?
A) $3.26 to $3.49
B) $3.51 to $3.99
C) $3.26 to $3.99
D) $3.25 to $3.50

Question

​The Nelson Company's radio division currently is purchasing transistors from the Charlotte Co.for $3.50 each.The total number of transistors needed is 8,000 per month.Nelson Company's electronics division can produce the transistors for a cost of $4.00 each and they have plenty of capacity to manufacture the units.The $4 is made up of $3.25 in variable costs,and $0.75 in allocated fixed costs.What should be the range of a possible transfer price?
A) ​$3.26 to $3.49
B) ​$3.51 to $3.99
C) ​$3.26 to $3.99
D) ​$3.25 to $3.50

Quizplus · Accepted Answer

The Answer of ​The Nelson Company's radio division currently is purchasing transistors from the Charlotte Co.for $3.50 each.The total number of transistors needed is 8,000 per month.Nelson Company's electronics division can produce the transistors for a cost of $4.00 each and they have plenty of capacity to manufacture the units.The $4 is made up of $3.25 in variable costs,and $0.75 in allocated fixed costs.What should be the range of a possible transfer price?
A) ​$3.26 to $3.49
B) ​$3.51 to $3.99
C) ​$3.26 to $3.99
D) ​$3.25 to $3.50

​The Nelson Company's Radio Division Currently Is Purchasing Transistors from the Charlotte

The Nelson Company's Radio Division Currently Is Purchasing Transistors from the Charlotte