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Division A makes a part with the following characteristics: Production capacity in units selling price to outside customers Variable cost per unit Total fixed costs
Division A makes a part with the following characteristics: Production capacity in units selling price to outside customers Variable cost per unit Total fixed costs 25,700 units $ 20 $13 104,400 Division B, another division of the same company, would like to purchase 19,500 units of the part each period from Division A Division B is now purchasing these parts from an outside supplier at a price of $17 each. Suppose that Division A has ample idle capacity to handle all of Division B's needs without any increase in fixed costs and without cutting into sales to outside customers. If Division A refuses to accept the $17 price internally and Division B continues to buy from the outside supplier, the company as a whole will be: Multiple Choice Mulitiple Choice wors off by S136,500 each pertod. worse off by $58,500 each perlod worse off by $78,000 each perlod. worse off by $117,000 each period
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