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McFarlane Company has two divisions, Division C and Division D. Division C manufactures Part C82 and sells it to Division D, and also sells
McFarlane Company has two divisions, Division C and Division D. Division C manufactures Part C82 and sells it to Division D, and also sells the same part to the outside market for $61 per unit. Division C has capacity to make 575,000 units of C82 per year. The division's fixed costs are $7,000,000 per year and its variable costs per unit are as follows: (Click the icon to view the data for Division C.) Part C82 is an essential component for Division D's only product, the division sells 250,000 units per year at a price of $110 per unit. Division D's fixed costs are $4,500,000 per year and its variable costs per unit. excluding the cost of Part C82, are as follows: (Click the icon to view the data for Division D.) Read the requirement. Suppose Division C's demand for C82 from the outside market is currently 150,000 units per year. By how much will McFarlane's income decrease if Division D purchases its desired 250,000 units of C82 at $61 per unit from the market rather than from Division C? If Division D purchases its desired 250,000 units of C82 at $61 per unit from the market rather than from Division C, McFarlane's income will decrease by $
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