Question: please show step by step on getting the answer. Division A makes a part with the following characteristics: Production capacity in units Selling price to
please show step by step on getting the answer.
Division A makes a part with the following characteristics: Production capacity in units Selling price to outside customers Variable cost per unit Total fixed costs 33,200 units $ 27 19 $109,800 Division B, another division of the same company, would like to purchase 16,100 units of the part each period from Division A. Division B is now purchasing these parts from an outside supplier at a price of $24 each Suppose that Division A has ample idle capacity to handle all of Division B's needs without any increase in fixed costs and without cutting into sales to outside customers. If Division A refuses to accept the $24 price internally and Division B continues to buy from the outside supplier, the company as a whole will be: Multiple Choice worse off by $128,800 each period. worse off by $48,300 each period. worse off by $80,500 each period. worse off by $96,600 each period
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