Subject: accounting Division X makes a part with the following characteristics:Production capacitySelling price to outside customersVariable cost per unitFixed cost, totalDivision Y of the same company would like to purchase 10,060 units each period from Division X. Division Y now purchases the part from an outside supplier at a price of $29 each. Suppose Division X has sufficient excess capacity tohandle all of Division Y's needs without any increase in fixed costs and without cutting into sales to outside customers. If Division X refuses to accept the $29 price internally and Division Y continues to buy from the outside supplier, thecompany as a whole will be:Multiple ChoiceOworse off by $70,420 each period.better off by $10,060 each period.worse off by $60,360 each period.worse off by $20,120 each period.31,000 units$ 30$ 23$ 106,000better off by $60,360 each period.

In there exists a sufficient capacity, the minimum transfer price is the variable manufacturing…

Division X makes a part with the following characteristics: Production capacity Selling price to outside customers Variable cost per unit Fixed cost, total Division Y of the same company would like to purchase 10,060 units each period from Division X. Division Y now purchases the part from an outside supplier at a price of $29 each. Suppose Division X has sufficient excess capacity to handle a of Division Y's needs without any increase in fixed costs and without cutting into sales to outside customers. If Division X refuses to accept the $29 price internally and Division Y continues to buy from the outside supplier, the company as a whole will be: Multiple Choice O O O O worse off by $70,420 each period. better off by $10,060 each period. worse off by $60,360 each period. worse off by $20,120 each period. 31,000 units $ 30 $ 23 $ 106,000 better off by $60,360 each period.

Division X makes a part with the following characteristics: Production capacity Selling price to outside customers Variable cost per unit Fixed cost, total Division Y of the same company would like to purchase 10,060 units each period from Division X. Division Y now purchases the part from an outside supplier at a price of $29 each. Suppose Division X has sufficient excess capacity to handle a of Division Y's needs without any increase in fixed costs and without cutting into sales to outside customers. If Division X refuses to accept the $29 price internally and Division Y continues to buy from the outside supplier, the company as a whole will be: Multiple Choice O O O O worse off by $70,420 each period. better off by $10,060 each period. worse off by $60,360 each period. worse off by $20,120 each period. 31,000 units $ 30 $ 23 $ 106,000 better off by $60,360 each period.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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