Division a Has Variable Manufacturing Costs of $50 Per Unit

question 37

Multiple Choice

Division A has variable manufacturing costs of $50 per unit and fixed costs of $10 per unit.Division A is operating significantly below capacity,what is the optimal transfer price of an internal transfer when the market price is $75?

• A)$20
• B)$25
• C)$50
• D)$60
• E)$75

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