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Given the following information for Division K: Selling price to outside customers $ 60 Variable cost per unit $ 34 Total fixed costs $ 400,000
Given the following information for Division K:
Selling price to outside customers $ 60 Variable cost per unit $ 34 Total fixed costs $ 400,000 Capacity in units 25,000 Division L would like to purchase internally from Division K. Division L now purchases 6,000 units each period from outside suppliers at $57 per unit. Division K has ample excess capacity to handle all of Division L's needs. What is the lowest price that Division K could accept? $34.00. $57.00. $60.00. $50.00.
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