If this sale is made 2 per unit in variable selling and


Question - The Clarkson Company's Cargo Division is currently operating at 100% of capacity (capacity is 100,000 units). Normal selling price is $20.00 per unit. At current operating levels, fixed costs are $6 per unit and variable costs are $9 per unit. Another division of Clarkson Company would like to buy from the Cargo Division. If this sale is made, $2 per unit in variable selling and administrative costs would be saved. What is the lowest transfer price the Cargo Division should accept?

$13.00

$18.00

$15.00

$7.00

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Accounting Basics: If this sale is made 2 per unit in variable selling and
Reference No:- TGS02592246

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