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Aerated Water Company makes internal transfers at 175% of full cost. The Soda Refining Division purchases 30,300 containers of carbonated water per day, on average,
Aerated Water Company makes internal transfers at 175% of full cost. The Soda Refining Division purchases 30,300 containers of carbonated water per day, on average, from a local supplier, who delivers the water for $40 per container via an external shipper. To reduce costs, the company located an independent supplier in Missouri who is willing to sell 30,300 containers at $29 each, delivered to Aerated Water Company's Shipping Division in Missouri. The company's Shipping Division in Missouri has excess capacity and can ship the 30,300 containers at a variable cost of $2.00 per container. What is the total cost to Aerated Water Company if the carbonated water is purchased from the local supplier? O A. $1,212,000 OB. $1,575,600 OC. $2,530,050 OD. $2,121,000
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