Figure 20-1
Universe Industries Has Two Divisions: the Haley Division

question 22

Multiple Choice

Figure 20-1
Universe Industries has two divisions: the Haley Division and the Comet Division. Information about a component that the Haley Division produces is as follows: $\begin{array}{lr}\text { Sales } & £ 120 \text { per unit } \\\text { Variable manufacturing costs } & £ 30 \text { per unit } \\\text { Fixed manufacturing overhead } & £ 20 \text { per unit } \\\text { Expected sales in units } & 4,000 \text { units }\end{array}$ The Haley Division can produce up to 5,000 components per year. The Comet Division needs 200 units of the component for a product it manufactures.
-Refer to Figure 20-1. The minimum transfer price that the Haley Division would be willing to accept is

• A)£120.
• B)£70.
• C)£50.
• D)£30.

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Definitions:

Department 1

A generic term that may refer to the first division or unit within an organization or company, often associated with a specific function or set of responsibilities.

Commissions Paid

Payments made to employees or agents based on their sales volume or performance.

Cost Trends

Patterns or movements in cost over a period of time, indicating how expenses are changing and affecting profitability.

Yield Trends

Refers to the patterns or movements in the yield or return on investments, securities, or assets over a certain period.