You have been provided with the following information for Division X of a decentralized company: Selling price Variable cost per unit Fixed cost per unit Sales volume (units) %24 105 48 20 21, 200 24,500 Capacity (units) Division Y of the same company would like to purchase all of its units internally. Division Y needs 9,900 units each period and currently pays $99 per unit to an outside firm, What is the lowest price that Division X could accept from Division Y? (Assume that Division Y wants to use a sole supplier and will not purchase less than 9,900 from a supplier.)
You have been provided with the following information for Division X of a decentralized company: Selling price Variable cost per unit Fixed cost per unit Sales volume (units) %24 105 48 20 21, 200 24,500 Capacity (units) Division Y of the same company would like to purchase all of its units internally. Division Y needs 9,900 units each period and currently pays $99 per unit to an outside firm, What is the lowest price that Division X could accept from Division Y? (Assume that Division Y wants to use a sole supplier and will not purchase less than 9,900 from a supplier.)
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter14: Decentralized Operations
Section: Chapter Questions
Problem 14.18E
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![TB MC Qu. 15-33 (Algo) You have been provided with the...
You have been provided with the following information for Division X of a decentralized company:
Selling price
105
48
Variable cost per unit
Fixed cost per unit
Sales volume (units)
Capacity (units)
20
21,200
24,500
Division Y of the same company would like to purchase all of its units internally. Division Y needs 9,900 units each period and currently pays $99 per unit to an
outside firm. What is the lowest price that Division X could accept from Division Y? (Assume that Division Y wants to use a sole supplier and will not purchase less
than 9,900 from a supplier.)
%24](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F846731f5-07d9-436a-9c82-4241ea515dde%2F98f65400-3b8a-4768-b37e-d8446ceb0b8d%2Fgayl74w_processed.jpeg&w=3840&q=75)
Transcribed Image Text:TB MC Qu. 15-33 (Algo) You have been provided with the...
You have been provided with the following information for Division X of a decentralized company:
Selling price
105
48
Variable cost per unit
Fixed cost per unit
Sales volume (units)
Capacity (units)
20
21,200
24,500
Division Y of the same company would like to purchase all of its units internally. Division Y needs 9,900 units each period and currently pays $99 per unit to an
outside firm. What is the lowest price that Division X could accept from Division Y? (Assume that Division Y wants to use a sole supplier and will not purchase less
than 9,900 from a supplier.)
%24
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