Business, 14.06.2021 15:30 binu

A company has two operating segments. Segment A of the company has been operating at 70% capacity for the last two years. It produces a single product, which it sells to external customers for $17 per unit. Variable costs to produce one unit are $11 and the allocated fixed overhead costs are $3 per unit. Segment B purchases the same product produced by Segment A from an outside vendor for $15. Management is considering obtaining the product from Segment A. If Segment A begins to manufacture enough product to sell to its external customers, as well as to Segment B, Segment A will be operating at 94% capacity. What is the minimum price that Segment A should charge Segment B?

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A company has two operating segments. Segment A of the company has been operating at 70% capacity fo...

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