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Question 4 (2.5 points) Division makes a part with the following characteristics: Production capacity in units 50,000 units Sales to outside customers 42,000 units Selling
Question 4 (2.5 points) Division makes a part with the following characteristics: Production capacity in units 50,000 units Sales to outside customers 42,000 units Selling price to outside customers S80 Variable cost per unit $50 Total fixed costs $300,000 Division R, another division of the same company, would like to purchase 6,000 units of the part each period from Division Q. Division R is now purchasing these parts from an outside supplier at a price of $78 each Managers of each division are free to make decisions related to purchases and sales of its own products. If a transfer does not take place, the corporation will be: Better off by $12,000 each period Worse off by $12,000 each period Worse off by $168,000 each period Worse off by $84,000 each period
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