Given the Following Information for Camping Division The Lantern Division Would Like to Purchase Internally from the l

question 28

Multiple Choice

Given the following information for Camping Division:
$$\begin{array} { | l | r | } \hline \text { Selling price to outside customers } & \$ 50 \\\hline \text { Variable cost per unit } & \$ 30 \\\hline \text { Total fixed costs } & \$ 400,000 \\\hline \text { Capacity in units } & 25,000 \\\hline\end{array}$$ The Lantern Division would like to purchase internally from the Camping Division.The Lantern Division now purchases 5,000 units each period from outside suppliers at $49 per unit.The Camping Division has ample excess capacity to handle all of the Lantern Division's needs.What is the lowest price that Camping Division could accept?

• A) $50.00.
• B) $49.00.
• C) $46.00.
• D) $30.00.

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Definitions:

General Knowledge

A broad range of facts, concepts, and information about various subjects that are not specialized but are known by many people.

Recognition

A measure of memory in which the person need only identify items previously learned, as on a multiple-choice test.

Recall

A measure of memory in which the person must retrieve information learned earlier, as on a fill-in-the-blank test.

Memory

The faculty by which the mind stores and remembers information.