Raven, Inc. has a division that manufactures a component that sells for $185 and has a variable cost of $50. Another division of the company wants to purchase the component. Fixed cost per unit of the component is $21. What is the minimum transfer price if the division is operating below its capacity? Raven, Inc. has a division that manufactures a component that sells for $185 and has a variable cost of $50. Another division of the company wants to purchasethe component. Fixed cost per unit of the component is $21. What is the minimum transfer price if the division is operating below its capacity?O A. $185O B. $71OC. $50O D. $21

given that, selling price = $185 Variable cost = $50 Fixed cost per unit = $21

Answered: Raven, Inc. has a division that…

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter11: Performance Evaluation And Decentralization

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Raven, Inc. has a division that manufactures a component that sells for $185 and has a variable cost of $50. Another division of the company wants to purchase the component. Fixed cost per unit of the component is $21. What is the minimum transfer price if the division is operating below its capacity?

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