Given the following data for Division X:

Selling price to outside customers	$	42
Variable cost per unit		24.75
Fixed cost - Total		80,000
Capacity (in units)		80,000

Division Y would like to purchase 23,500 units each period from Division X. Division X has ample excess capacity to handle all of Division Y's needs. Division Y now purchases from an outside supplier at a price of $28.5. If Division X refuses to accept an $26.5 price internally, the company, as a whole, will be worse off by:

A. $41,125

B. $317,250

C. $88,125

D. $405,375