Holiday Corp

question 96

Multiple Choice

Holiday Corp.has two divisions,Quail and Marlin.Quail produces a widget that Marlin could use in its production.Quail's variable costs are $4 per widget while the full cost is $7.Widgets sell on the open market for $12 each.If Quail is operating at capacity,what would be the minimum transfer price if Marlin currently is purchasing 100,000 units on the open market?

• A)$4.00
• B)$5.00
• C)$7.00
• D)$12.00

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Definitions:

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