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One division in a company would like to purchase a product from another division in the company. Variable cost of the selling division is $40

One division in a company would like to purchase a product from another division in the company. Variable cost of the selling division is $40 per unit and its fixed cost is $10 per unit. If the selling unit is already operating at capacity, the transfer price should be equal to ______.

Multiple choice question.

variable cost + fixed cost + lost contribution margin

variable cost + lost contribution margin

variable cost

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