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Materials used by Jefferson Company in producing Division C's product are currently purchased from outside suppliers at a cost of $10 per unit. However, the
Materials used by Jefferson Company in producing Division C's product are currently purchased from outside suppliers at a cost of $10 per unit. However, the same materials are available from Division A. Division A has unused capacity and can produce the materials needed by Division C at a variable cost of $8.50 per unit. A transfer price of $9.50 per unit is negotiated and 30,000 units of material are transferred, with no reduction in Division A's current sales. How much would Division A's income from operations increase? a. $90,000 b. $30,000 c. $60,000 d. $0 How much would Division C's income from operations increase? a. $60,000 b. $90,000 c. $15,000 d. $0 this one i understand - - - How much would Jefferson's total income from operations increase? a. $120,000 b. $150,000 c. $60,000 d. $45,000 ....it D... Plz help with the rest
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