Answer the Following Questions Using the Information Below:
NSW Farmers

question 119

Multiple Choice

Answer the following questions using the information below:
NSW Farmers Coop has two divisions: Distribution and Production.The company's primary product is fertiliser.Each division's costs are provided below:
$$\begin{array} { l r l } \text { Production: } & \text { Variable costs per kilo } & \$ 0.05 \\& \text { Fixed costs per kilo } & \$ 0.25 \\\text { Distribution: } & \text { Variable costs per kilo } & \$ 0.03 \\& \text { Fixed costs per kilo } & \$ 0.02\end{array}$$ The Distribution Division has been operating at a capacity of 4 000 000 kilos a week and usually purchases 2 000 000 kilos from the Production Division and 2 000 000 kilos from other suppliers at $0.45 per kilo.
-What is the transfer price per kilo from the Production Division to the Distribution Division,assuming the method used to place a value on each kilo of fertiliser is 160% of variable costs?

• A)$0.11
• B)$0.40
• C)$0.08
• D)$0.05

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Definitions:

Intensity

The magnitude or strength of a phenomenon, such as sound, light, or physical force, often described in terms of levels or degrees.

Pain

An unpleasant sensory and emotional experience associated with actual or potential tissue damage, or described in terms of such damage.

Acute Pain

A type of pain that is sharp and severe but lasts for a relatively short period, often signaling tissue damage or an injury.

Fibromyalgia

A chronic disorder characterized by widespread musculoskeletal pain, fatigue, and tenderness in localized areas.