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Hu Corporation Has Two Operating Divisions, a AndB A)$115
B)$195
C)$125
D)$200

question 43

Multiple Choice

Hu Corporation has two operating divisions, A andB. The following information is provided for Division A: Division B uses the type of product produced by Division A and has approached Division A about buying the product internally. Division B is currently paying $180 to purchase the product from an outside source. If Division A sells internally it can save $5 per unit in variable costs. Assuming Division A is operating at capacity, what price should it charge Division B if the transfer is to be made?
 Unit selling price $200 Unit variable costs $120 Unit fixed costs $40\begin{array} { | l | l r | } \hline \text { Unit selling price } & \$ & 200 \\\hline \text { Unit variable costs } & \$ & 120 \\\hline \text { Unit fixed costs } & \$ & 40 \\\hline\end{array}

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Definitions:

Commuting Distance

The distance that an individual travels from their home to their place of work or study.

Parameter

A numerical characteristic or measure that describes and summarizes a whole population.

Statistic

is a single measure, calculated from sample data, used to infer or describe properties of a population.

Significance Level

A threshold for determining whether a statistical result is considered statistically significant, usually denoted by alpha (α).

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