In order to remain competitive an organization wishes to achieve cost savings for one of its existing products. Which of the following correctly describes methods which the organization can use to achieve these cost savings? Select ALL that apply.
A company is investing $150,000 in a project which will yield an annual cash inflow of $40,000 for eight years. The company's cost of capital is 10%. To the nearest $100, what is the project's equivalent annual net present value?
An organization has a decentralized structure in which division A supplies division B with an intermediate product for which there is no external market. Division B carries out further processing and then sells the final product on the external market. Due to organizational policy the current transfer pricing basis is variable cost. The manager of division A has stated, 'The current transfer price is unfair because it does not enable us to recoup our costs'. The manager of division B has stated, 'The current transfer pricing system enables us to quote competitive prices for the finished product'. The Chief Executive of the organization is considering imposing a transfer pricing policy that uses dual pricing. Dual pricing would: