Southern Pride Industries would like its Alabama Division to sell 30,000 units to its Arkansas Division for a price of $39. The Alabama Division is currently operating at capacity. Alabama Division s unit variable cost is $24, unit fixed cost is $15, and unit selling price is $60. What is the minimum transfer price that the Alabama Division should accept? a. $36 b. $39 C. $24 d. $60
Southern Pride Industries would like its Alabama Division to sell 30,000 units to its Arkansas Division for a price of $39. The Alabama Division is currently operating at capacity. Alabama Division s unit variable cost is $24, unit fixed cost is $15, and unit selling price is $60. What is the minimum transfer price that the Alabama Division should accept? a. $36 b. $39 C. $24 d. $60
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:Southern Pride Industries would like its Alabama Division
to sell 30,000 units to its Arkansas Division for a price of
$39. The Alabama Division is currently operating at
capacity. Alabama Division s unit variable cost is $24, unit
fixed cost is $15, and unit selling price is $60. What is the
minimum transfer price that the Alabama Division should
accept?
a. $36
b. $39
C.
$24
d. $60
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