WAX-D Inchas a Division That Manufactures a Component That Sells for for $150

question 31

Multiple Choice

WAX-D Inc.has a division that manufactures a component that sells for $150 and has a variable cost of $45.Another division of the company wants to purchase the component.Fixed cost per unit of component is $25.What is the minimum transfer price if the division is operating below its capacity?

• A)$50
• B)$45
• C)$70
• D)$40

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Definitions:

Unique Contribution

A unique contribution refers to a specific, novel input or insight provided by a researcher or study, distinct from previous work in the field.

Standard Error

A statistical measure that quantifies the variability or spread of sample means around the population mean.

Variance

The square of the standard deviation and another measure of a distribution’s spread or dispersion.

Independent Variable

The variable that is manipulated or controlled by the researcher to test its effect on the dependent variable.