Question: <a href=224 CHAPTER 26 Pricing Decisions, Including Target Costing and Transfer Pricing The budget is bas…” />Question: 224 CHAPTER 26 Pricing Decisions, Including Target Costing and Transfer Pricing The budget is bas...

Never use plagiarized sources. Get Your Original Essay on
Question: 224 CHAPTER 26 Pricing Decisions, Including Target Costing and Transfer Pricing The budget is bas…
Hire Professionals Just from $11/Page
Order Now Click here

Show transcribed image text 224 CHAPTER 26 Pricing Decisions, Including Target Costing and Transfer Pricing The budget is based on the demand previously stated. The S846,000, company wants to carn an annual operating income of wholesale prices for the year. Their Last week, four competitors released their S24.58; Competi Compe r A, 25.68; Competitor B, prices are as follows: 6; Competitor D, S25.30 their high quality. However Sumac & Oak's portable devices are known for price causes a 55,000 every si price crease above competitor's all price changes occur d from e orig al estimate. Ass me deman $1 increments Required re a schedule of total projected costs and uni costs. ute the anticipated se 1. Prep co 2. Use gross margin pricing to g price Sumac & Oak's portable devi ces, what shoul t cost)? Defend your answer. (Hint: Deter 3. Based on compe assume a constant sell for mine the tot operating come at various sales levels o 4. Would your pricing structure in req rement 3 change if the company had wi limited competition at this quality level If so, in what direction? Explain LO3 Pricing Decisions equipment for retail stores. Carol P7. The Fastener Company manufactures office that Fastener introduce Watson, the vice president of marketing, has proposed Watson two new products: an electric stapler an electric pencil sharpener. price requested that the Profit Planning Department develop preliminary selling for the two new products for her review policy for developing Profit Planning has followed the company's standard product. The potential sc It has used all data available for each accumulated by Profit Planning are as follows Electric Pencil Electric Sharpener Stapler 12,000 16,000 Estimated annual demand in units $15.00 $14.00 Estimated unit manufacturing costs Estimated unit selling and Not available $3.00 administrative expenses Not available $160,000 Assets employed in manufacturing Fastener plans to use an average of $1,200,000 in assets to support operations in the current year. The condenscd budgeted income statement that follows reflects the planned return on assets of 20 percent ($240,000 S1,200,000) for the entire company for all products Fastener Company Budgeted Income Statement For the Year Ended May 31 (in thousands) Revenue $2,400 Cost of goods sold 1,440 Gross profit 960 Selling and administrative expenses 720 operating income 240

224 CHAPTER 26 Pricing Decisions, Including Target Costing and Transfer Pricing The budget is based on the demand previously stated. The S846,000, company wants to carn an annual operating income of wholesale prices for the year. Their Last week, four competitors released their S24.58; Competi Compe r A, 25.68; Competitor B, prices are as follows: 6; Competitor D, S25.30 their high quality. However Sumac & Oak's portable devices are known for price causes a 55,000 every si price crease above competitor's all price changes occur d from e orig al estimate. Ass me deman $1 increments Required re a schedule of total projected costs and uni costs. ute the anticipated se 1. Prep co 2. Use gross margin pricing to g price Sumac & Oak's portable devi ces, what shoul t cost)? Defend your answer. (Hint: Deter 3. Based on compe assume a constant sell for mine the tot operating come at various sales levels o 4. Would your pricing structure in req rement 3 change if the company had wi limited competition at this quality level If so, in what direction? Explain LO3 Pricing Decisions equipment for retail stores. Carol P7. The Fastener Company manufactures office that Fastener introduce Watson, the vice president of marketing, has proposed Watson two new products: an electric stapler an electric pencil sharpener. price requested that the Profit Planning Department develop preliminary selling for the two new products for her review policy for developing Profit Planning has followed the company's standard product. The potential sc It has used all data available for each accumulated by Profit Planning are as follows Electric Pencil Electric Sharpener Stapler 12,000 16,000 Estimated annual demand in units $15.00 $14.00 Estimated unit manufacturing costs Estimated unit selling and Not available $3.00 administrative expenses Not available $160,000 Assets employed in manufacturing Fastener plans to use an average of $1,200,000 in assets to support operations in the current year. The condenscd budgeted income statement that follows reflects the planned return on assets of 20 percent ($240,000 S1,200,000) for the entire company for all products Fastener Company Budgeted Income Statement For the Year Ended May 31 (in thousands) Revenue $2,400 Cost of goods sold 1,440 Gross profit 960 Selling and administrative expenses 720 operating income 240

Open chat
Lets chat on via WhatsApp
Hello, Welcome to our WhatsApp support. Reply to this message to start a chat.