The Venus Division of Heinz Ltd Produces Dilithium Crystals Assume That Venus Cannot Sell Any Additional Crystals Externally

Multiple Choice

The Venus Division of Heinz Ltd produces dilithium crystals. One-third of its output is sold to the Bruno Division, and the remainder is sold externally. Venus's estimated sales and cost data for the coming year are: $$\begin{array} { l c c } & \underline{\text { Antari Division} } & \underline{\text { External Sales} } \\ \text { Units } & 12,500 & 25,000\\\text { Sales } & \$ 18,750 & \$ 50,000 \\\text { Variable costs } & 12,500 & 25,000 \\\text { Fixed costs } & 3,750 & 7,500\end{array}$$ Assume that Venus cannot sell any additional crystals externally. If the Bruno Division has an opportunity to buy from an outside supplier at $1.40 per crystal and Venus refuses to meet this price, the company as a whole will be:

A) $3,750 worse off
B) $6,250 better off
C) $1,250 better off
D) $5,000 worse off