Evergreen Corp

question 21

Multiple Choice

Evergreen Corp.has two divisions,Fern and Bark.Fern produces a widget that Bark could use in the production of units that cost $175 in variable costs,plus the cost of the widget,to manufacture.Fern's variable costs are $60 per widget,and fixed manufacturing costs are applied at a rate of $36 per widget.Widgets sell on the open market for $105 each.Evergreen's policy is that internal transfers will be made at variable cost.If Bark purchases the widgets from Fern,what will be the transfer price?

• A)$60
• B)$96
• C)$100
• D)$175

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Definitions:

Testes

Male reproductive organs responsible for producing sperm and hormones, such as testosterone.

Endocrine System

A network of glands and organs that produce, store, and secrete hormones into the bloodstream to regulate the body's processes and maintain homeostasis.

Hormones

Chemical messengers produced by the endocrine glands that regulate various bodily functions, including growth, metabolism, and mood.

Bloodstream

The circulating fluid in the body that delivers nutrients and oxygen to cells while removing waste products.