Managerial Accounting Final. PDF

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Final exam answers from 2019-2020. Answers are provided in the document....

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Long answer Question 1 : 1a) What is the minimum transfer price the bottle making division will sell an additional case of bottles to the brewery division? Minimum=VC VC=4.00$ The minimum transfer price is 4$.

1b) What is the maximum transfer price the brewery division will buy an additional case of bottles from the bottling making division? Maximum transfer price= Market Price Market price= 6$ The maximum transfer price is 6$ 1c) Current production for the Bottle division is based on estimated sales of 320,000 cases (170,000 cases on the open market and 150,000 cases to the brewery division). The brewery division would like to purchase an additional 30,000 cases from the bottle division. The special order does not requiring packaging – this will reduce the cost for the Bottling division by $0.05 per case. What is the minimum transfer prices per case the bottle making division will sell the additional 30,000 cases to the brewery division? 6.00-0.05=5.95 5.95 per case 1d) Based on the information in part C, what is the maximum price per case that the Brewing division is willing to pay for an additional 30,000 cases. 6$ since it is market price

1e) What kinds of things would the Bottling Division be responsible for if it was a Cost Centre instead of a profit centre? focus would be on the costs rather than revenues and profits and investments. they would track expenses. keeping the costs in line with the budget.

Question 2:

Calculate the Net Present Value of this project

Calculate the Payback period of this project Annual cash flow : accounting profit +depreciation 80,000+(300,000/3) =180,000 Payback period 1+170,000/180,000 =1.94 rounded 2 years

Question 3: Compute net income if Eastern Stores closes the Bampton location.

net income: 1.8million, since there is an increase bampton should be closed.

Question 4: a) What was the total standard cost of the ending inventory under absorption costing. ending inv: 2400 standard cost per unit 30 2400*30 =72,000 standard cost of the ending inventory b) Reconcile the difference in retained earnings at the end of the period under absorption costing and variable costing?...