Division A makes a part with the following characteristics: Production capacity in units 34,000 units Selling price to outside customers


Division A makes a part with the following characteristics: Production capacity in units 34,000 units Selling price to outside customers $ 21 Variable cost per unit $ 13 Total fixed costs $ 105,800 Division B, another division of the same company, would like to purchase 10,000 units of the part each period from Division A. Division B is now purchasing these parts from an outside supplier at a price of $18 each. Suppose that Division A is operating at capacity and can sell all of its output to outside customers at its usual selling price. If Division A agrees to sell the parts to Division B at $18 per unit, the company as a whole will be: rev: 10_24_2020_QC_CS-237557 Multiple Choice worse off by $30,000 each period. better off by $30,000 each period. worse off by $60,000 each period. There will be no change in the status of the company as a whole.


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