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Agenda Today – Session 9. Go over assigned problems Answer questions Take quiz. Problem Background. California Instrument Company consists of two divisions: Semiconductor division Super-chip Okay-chip Process-control division Process-control unit. Cost Information. Requirement 1.

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agenda today session 9
Agenda Today – Session 9
  • Go over assigned problems
  • Answer questions
  • Take quiz

A&MIS 525

problem background
Problem Background
  • California Instrument Company consists of two divisions:
    • Semiconductor division
      • Super-chip
      • Okay-chip
    • Process-control division
      • Process-control unit

A&MIS 525

requirement 1
Requirement 1
  • Calculate the contribution margin per hour from producing and selling each OK-Chip and each Super-Chip. If no transfers are to be made to the Process-Control Division, how many OK-Chips and Super-Chips should the Semiconductor Division produce and sell?

A&MIS 525

requirement 2
Requirement 2
  • The Process-Control Division expects to sell 5,000 unit this year. From the viewpoint of California Instruments as a whole, should 5,000 Super-Chips be transferred to the Process-Control Division instead of purchasing circuit boards?

A&MIS 525

requirement 3
Requirement 3

A&MIS 525

requirement 4
Requirement 4

A&MIS 525

requirement 41
Requirement 4

A&MIS 525

requirement 42
Requirement 4
  • Transfer price:
    • $46 to $50 on 10,000 Super-chips or less
    • $60 for each additional Super-chip

A&MIS 525

session 3
Session 3

William F. Bentz

January 22 , 2002

Fisher College of Business

A&MIS 525