Raven,Inchas a Division That Manufactures a Component That Sells for $195

question 99

Multiple Choice

Raven,Inc.has a division that manufactures a component that sells for $195 and has a variable cost of $30.Another division of the company wants to purchase the component.Fixed cost per unit of the component is $20.What is the minimum transfer price if the division is operating below its capacity?

• A) $195
• B) $30
• C) $50
• D) $20

---

Definitions:

Superego

The superego is one of the three parts of the human psyche in Freudian psychoanalytic theory, acting as the ethical component of the personality by providing moral standards.

Ego

In psychoanalytic theory, the part of the personality that mediates between the demands of the id, superego, and reality.

Self-Actualization

The realization or fulfillment of one's talents and potentialities, considered as a drive or need present in everyone.

Unconscious

A part of the mind that contains thoughts, memories, and desires not within conscious awareness, but can influence behavior and emotions.