Hrubec Products, Inc. (Ch 11)

Hrubec Products, Inc., operates a Pulp Division that manufactures wood pulp for use in the production of various paper goods. Revenue and costs associated pulp follow: Selling price $23 Expenses: Variable $14 Fixed (based on a capacity of 6 20 98,000 tons per year) Net operating income Hrubec Products has just company that manufactures paper cartons. This company will be treated as a division of acquired a small newly formed Carton Division is currently Hrubec with full profit responsibility. The a 10% purchase purchasing 27,000 tons of pulp per year from a supplier at a cost of $23 per ton, less from the Pulp discount. Hrubec's president is anxious for the Carton. Division to begin purchasing its pulp Division if an acceptable transfer price can be worked out