Panther Company had the following historical accounting data per unit: The units are normally transferred internally from Division A to Division B. The units also may be sold externally for $210 per unit. The minimum profit level accepted by the company is a markup of 30 percent. There were no beginning or ending inventories.
If the negotiated price is used, Division A's transfer price should be a
A) minimum of $120.00.
B) minimum of $153.00.
C) maximum of $198.90.
D) maximum of $210.00.

Question

Panther Company had the following historical accounting data per unit:  The units are normally transferred internally from Division A to Division B. The units also may be sold externally for $210 per unit. The minimum profit level accepted by the company is a markup of 30 percent. There were no beginning or ending inventories.
If the negotiated price is used, Division A's transfer price should be a
A) minimum of $120.00. 
B) minimum of $153.00. 
C) maximum of $198.90. 
D) maximum of $210.00.

Quizplus · Accepted Answer

The Answer of Panther Company had the following historical accounting data per unit:  The units are normally transferred internally from Division A to Division B. The units also may be sold externally for $210 per unit. The minimum profit level accepted by the company is a markup of 30 percent. There were no beginning or ending inventories.
If the negotiated price is used, Division A's transfer price should be a
A) minimum of $120.00. 
B) minimum of $153.00. 
C) maximum of $198.90. 
D) maximum of $210.00.

Panther Company Had the Following Historical Accounting Data Per Unit