Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Intermediate. X plc, a manufacturing company, has two divisions: Division A and Division B. Division A produces one type of product, ProdX, which it

 

Intermediate. X plc, a manufacturing company, has two divisions: Division A and Division B. Division A produces one type of product, ProdX, which it Transfers to Division B and also sells externally. Division B has been approached by another company which has offered to supply 2500 units of ProdX for 35 each. The following details for Division A arc available; Salen reveno Sales to Drvisicn Be40 per unt External ses O CA5 per unt Les Variable cost 22 per unit 400 000 270 000 362 000 100 000 Fied costs Proft If Division B decides to buy from the other company, the impact of the decision on the profits of Division A and X plc, assuming external sales of ProdX cannot be increased, will be Dvisions A Xpic A. E16 625 decroase 32 S00 decreane 45 000 decrease 45 000 decreane 12 500 docrease $12 500 decreane 12 500 incrase E32 500 incrense 32 500 decrease E45 C00 decrease

Step by Step Solution

3.48 Rating (148 Votes )

There are 3 Steps involved in it

Step: 1

Correct answer D 45000 Decrease 32500 Decrease Detail working for easy understanding Currently Sal... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Foundations of Financial Management

Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta

10th Canadian edition

1259261018, 1259261015, 978-1259024979

More Books

Students also viewed these Accounting questions

Question

Discuss the advantages and disadvantages of debt.

Answered: 1 week ago