DATA FOR TOWER HILL DIVISION Revenue Fixed Asset: 10,000 Purchases by division 500 Purchases by Head Office 2,500 Direct Material and Labour Costs (variable) 6,000 Indirect Labour (Consolidate fixed overhead) 1000 Divisional Manager's Salary 400 Apportioned Head Office Costs Depreciation on fixed assets Company's cost of capital 600 20% 10% Assuming that fixed assets comprise the total investment in Tower Hill Division. You are required to determine the following: (iv). Controllable residual profit (v). Net residual profit

DATA FOR TOWER HILL DIVISION Revenue Fixed Asset: 10,000 Purchases by division 500 Purchases by Head Office 2,500 Direct Material and Labour Costs (variable) 6,000 Indirect Labour (Consolidate fixed overhead) 1000 Divisional Manager's Salary 400 Apportioned Head Office Costs Depreciation on fixed assets Company's cost of capital 600 20% 10% Assuming that fixed assets comprise the total investment in Tower Hill Division. You are required to determine the following: (iv). Controllable residual profit (v). Net residual profit

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter14: Decentralized Operations

Section: Chapter Questions

Problem 14.11E

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