8.13 The Domi no Company has two decentralized divisions, A and B. Division A purchased certain uni ts from Division B at $75 per uni t. Because Division B pla n price to $100 per unit, Division A desires to purchase these uni ts from outside sup per uni t. Division B's costs follow: Division B's variable costs per unit Division B's annual fixed costs Division A's purchase $70 $15,000 1,000 units If Division A buys from an outside supplier, the facilities Division B uses to man u units will remain idle. Would it be more profita ble for the company to enforce the $100 than to allow Division A to buy from outside suppliers at $75 per unit? (A I C
Solution ID:10137795 | Question answered on 16-Oct-2016
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