(Appendix 11A) Fingado Products, Inc

question 23

Multiple Choice

(Appendix 11A) Fingado Products, Inc., has a Detector Division that manufactures and sells a number of products, including a standard detector that could be used by another division in the company, the Commercial Security Division, in one of its products. Data concerning that detector appear below:
The Commercial Security Division is currently purchasing 6,000 of these detectors per year from an overseas supplier at a cost of $91 per detector.
-Assume that the Detector Division is selling all of the detectors it can produce to outside customers.What should be the minimum acceptable transfer price for the detectors from the standpoint of the Detector Division?

• A) $32 per unit
• B) $98 per unit
• C) $91 per unit
• D) $83 per unit

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