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Swan Company has two divisions, Hill and Paradise. Hill produces a unit that Paradise could use in its production. Paradise currently is purchasing 4,100
Swan Company has two divisions, Hill and Paradise. Hill produces a unit that Paradise could use in its production. Paradise currently is purchasing 4,100 units from an outside supplier for $47. Hill is operating at less than full capacity and has variable costs of $21.80 per unit. The full cost to manufacture the unit is $34.40. Hill currently sells 449,100 units at a selling price of $52.60. How much profit will Hill receive from the transfer if a transfer price of $33 is agreed upon? Multiple Choice $6,100 loss $97,100 loss $34300 profit $45,920 profit
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