Texoma Corporation
Texoma Corporation is comprised of two divisions: X and Y.X currently produces and sells a gear assembly used by the automotive industry in electric window assemblies.X is currently selling all of the units it can produce (25,000 per year)to external customers for $25 per unit.At this level of activity,X's per unit costs are:
Variable:
Procuction $ \$ 7 $
SG&A 2
Fixed:
Prochuction 6
SG&A 5
Y Division wants to purchase 5,000 gear assemblies per year from X Division.Y Division currently purchases these units from an outside vendor at $22 each.
Refer to Texoma Corporation.What is the minimum price per unit that X Division could accept from Y Division for 5,000 units of the gear assembly and be no worse off than currently?

Question

Texoma Corporation
Texoma Corporation is comprised of two divisions: X and Y.X currently produces and sells a gear assembly used by the automotive industry in electric window assemblies.X is currently selling all of the units it can produce (25,000 per year)to external customers for $25 per unit.At this level of activity,X's per unit costs are:
 Variable:
Procuction                                $ \$ 7 $
SG&A                                        2
Fixed:
Prochuction                                 6
SG&A                                         5 
Y Division wants to purchase 5,000 gear assemblies per year from X Division.Y Division currently purchases these units from an outside vendor at $22 each.
Refer to Texoma Corporation.What is the minimum price per unit that X Division could accept from Y Division for 5,000 units of the gear assembly and be no worse off than currently?

Quizplus · Accepted Answer

The Answer of Texoma Corporation
Texoma Corporation is comprised of two divisions: X and Y.X currently produces and sells a gear assembly used by the automotive industry in electric window assemblies.X is currently selling all of the units it can produce (25,000 per year)to external customers for $25 per unit.At this level of activity,X's per unit costs are:
 Variable:
Procuction                                $ \$ 7 $
SG&A                                        2
Fixed:
Prochuction                                 6
SG&A                                         5 
Y Division wants to purchase 5,000 gear assemblies per year from X Division.Y Division currently purchases these units from an outside vendor at $22 each.
Refer to Texoma Corporation.What is the minimum price per unit that X Division could accept from Y Division for 5,000 units of the gear assembly and be no worse off than currently?

Texoma Corporation Texoma Corporation Is Comprised of Two Divisions: X $7 \$ 7 $7

Texoma Corporation
Texoma Corporation Is Comprised of Two Divisions: X $\$ 7$