Fixed cost per unit of component is 25 what is the minimum, Accounting Basics

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Fixed cost per unit of component is 25 what is the minimum

Accounting

WAX-D Inc. has a division that manufactures a component that sells for $150 and has a variable cost of $45. Another division of the company wants to purchase the component. Fixed cost per unit of component is $25. What is the minimum transfer price if the division is operating below its capacity? Show calculation.

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Accounting Basics: Fixed cost per unit of component is 25 what is the minimum

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