Division a of Sibley, Inc

question 52

Multiple Choice

Division A of Sibley, Inc. has operating data as follows: Capacity 20,000 units
Selling price $80 per unit
Variable costs $45 per unit
Fixed costs $20 per unit
Division B wants to purchase units from Division A. If Division A agrees to sell units to Division B, A's variable costs will be $5 less per unit.
If Division A has capacity available to meet B's requirements, what is the minimum price it should charge?

• A)$40
• B)$75
• C)$20
• D)$60

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Definitions:

One Carbon Compounds

Organic compounds that contain only one carbon atom, often involved in fundamental biochemical processes.

Ethylene Glycol

A colorless, odorless, syrupy liquid used as antifreeze in cooling and heating systems, and in the manufacture of polyester fibers.

Phosgene

A toxic chemical compound used as an industrial reagent and chemical weapon, with the formula COCl2.

Organic Compound

A compound primarily made of carbon atoms bonded to hydrogen, possibly along with oxygen, nitrogen, sulfur, phosphorus, and halogens.