Division S of Kracker Company Makes a Part That It

question 83

Multiple Choice

Division S of Kracker Company makes a part that it sells to other companies. Data on that part appear below: Division B, another division of Kracker Company, presently is purchasing 10,000 units of a similar product each period from an outside supplier for $28 per unit, but would like to begin purchasing from Division S.
Suppose that Division S can sell all that it can produce to outside customers. If Division S sells to Division B at a price of $28 per unit, the company as a whole will be:

• A) worse off by $80,000 each period.
• B) worse off by $70,000 each period.
• C) better off by $20,000 each period.
• D) worse off by $20,000 each period.

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Definitions:

Sales Personnel

Employees or members of an organization responsible for selling its products or services to customers.

Core Principles

Fundamental beliefs or values that serve as the foundation for the system, organization, or individual's actions and decisions.

Hindu Mahabharata

An ancient Indian epic poem that narrates the struggle between two groups of cousins in the Kurukshetra War.

Professional Selling

A sales approach focused on understanding the needs and preferences of the customer to offer solutions that meet those needs.