4) Division West does not have excess capacity to produce Product XX. The division can sell Product XX for $10 per unit outside the company. Variable costs are $6 per unit. Division East wants to purchase Product XX from Division West to use in Product ZZ. The selling price of Product ZZ is $25 per unit and variable costs to finish the product after the transfer are $12 per unit. An outside supplier will sell Product XX for $11 per unit. What is the maximum price Division East will pay for Product XX?

A) $11 per unit

B) $12 per unit

C) $13 per unit

D) none of the above

Answer: A

Why the aswer is A? I need explanation for that.