Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

A company permits its decentralized units to "lease" space to one another. Uptown division has leased some of its idle warehouse space to Downtown division for $60 per sq ft per month. Recently, Uptown obtained a new 5 year contract, which will increase its production sufficiently so that the warehouse space is more valuable to it. Uptown has notified downtown that he rental price will increase to $210 per sq ft. Downtown can lease space at$120 per sq ft in another warehouse from an outside company but prefers to stay in the shared facilities. Downtowns manager states that she would prefer not to move. If downtown division continues to use the space uptown will have to rent other space for $180 per sq ft. per month. (The difference in rental prices occurs because uptown division requires a more substantial warehouse building than downtown division does)

Recommend a transfer price and describe your reasons for choosing that price.

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M945907

Have any Question? 


Related Questions in Accounting Basics

Practice questionsconsider a business where you have had

Practice questions: Consider a business where you have had work experience or any other organisation with which you are familiar. What aspects of the business do you think are important which are not shown in the financi ...

Question 1you are a licensed cpa who is a member of both

Question #1 You are a licensed CPA who is a member of both the AICPA and the Oregon Society of CPAs. You work in the Tax Compliance Department of a major publicly traded supermarket chain. The company is considering whet ...

Colt football co had a player contract with watts that is

Colt Football Co. had a player contract with Watts that is recorded in its books at $5,600,000 on July 1, 2014. Day Football Co. had a player contract with Kurtz that is recorded in its books at $7,000,000 on July 1, 201 ...

Q1 kay corporation is engaged in the furniture

Q1. Kay Corporation is engaged in the furniture manufacturing business. Following are some of the financial figures of company: Sales                                      Rs. 760,000 Net Profit                            ...

Question part one what are the differences between a direct

QUESTION PART ONE: What are the differences between a direct cost and an indirect cost? Which is the more difficult cost to track? Why? How do indirect costs affect the cost of a product? Should indirect costs be include ...

Question -owing to low liquidity lisa ltd decides on 1 july

Question - Owing to low liquidity, Lisa Ltd decides on 1 July 2015 to sell its land and buildings to Anderson Ltd. The carrying values of the land and buildings in the books of Lisa Ltd, at 1 July 2015, are: Land at Cost ...

Case study -you are auditing the financial report of best

Case Study - You are auditing the financial report of Best Living Supplies Ltd (Best Living Supplies) for the year ended 30 June 2016. Best Living Supplies sells a wide variety of household products to retail outlets. Al ...

Valuation of accounts receivablesbulldiscuss the primary

Valuation of Accounts Receivables • Discuss the primary advantages and disadvantages of applying the direct write-off and the allowance method of writing off accounts. Even though the direct write-off method is not accep ...

Accounting codification assignment- harper company operates

Accounting Codification Assignment- Harper Company operates in an industry with numerous competitors. It is experiencing a shortage of cash and decides to obtain money from a large bank by using some of its receivables a ...

Bull the president of a plastics company was quoted in a

• The president of a plastics company was quoted in a business journal as stating, "We haven't had a dollar of interest-paying debt in over 10 years. Not many companies can say that." As a stockholder in this company, ho ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate