(Appendix 11A) Bacot Products, Inc

question 38

Multiple Choice

(Appendix 11A) Bacot Products, Inc., has a Valve Division that manufactures and sells a number of products, including a standard valve that could be used by another division in the company, the Pump Division, in one of its products. Data concerning that valve appear below:
The Pump Division is currently purchasing 8,000 of these valves per year from an overseas supplier at a cost of $47 per valve.
-Assume that the Valve Division has enough idle capacity to handle all of the Pump Division's needs.What should be the minimum acceptable transfer price for the valves from the standpoint of the Valve Division?

• A) $45 per unit
• B) $28 per unit
• C) $47 per unit
• D) $53 per unit

---

Definitions:

Merkel Cells

Specialized skin cells that function as mechanoreceptors for touch sensation, located in the epidermis.

Proprioceptors

are sensory receptors found in muscles, tendons, and joints, providing information about body position and movement.

Dermis

The thick layer of living tissue below the epidermis that forms the true skin, containing sweat glands, hair follicles, and blood vessels.

Glossopharyngeal

The ninth cranial nerve, which is involved in tasting, swallowing, and the gag reflex, as well as controlling some muscles and salivary glands.