Use the Information Below to Answer the Following Question(s)

question 118

Multiple Choice

Use the information below to answer the following question(s) .Soft Cushion Company is highly decentralized.Each division is empowered to make its own sales decisions.The Assembly Division can purchase cushion stuffing from the Production Division or from external suppliers.The Production Division has been the major supplier of stuffing in recent years.The Assembly Division has announced that two external suppliers will be used to purchase the stuffing at $20 per kilogram for the next year.The Production Division recently increased its unit price to $40.The manager of the Production Division presented the following information; variable cost $32, fixed cost $8, to top management in order to attempt to force the Assembly Division to purchase the stuffing internally.The Assembly Division purchases 20,000 kg per month.
-Cash outflows that are directly associated with the production and transfer of the products and services are called

• A)additional costs.
• B)opportunity costs.
• C)outlay costs.
• D)transfer costs.
• E)variable costs.

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Definitions:

Kicker's Payoffs

A rephrased definition: The potential returns or outcomes that a participant in a game or negotiation, known as the "kicker," stands to gain.

Probability of Success

The likelihood of a particular outcome deemed favorable or meeting a set goal.

Probability of Failure

The likelihood or risk that a system, component, or process will fail to perform within an expected timeframe.

Payoff Matrix

A table that shows the potential outcomes or payoffs of different strategies in a game or competitive situation.