A Selling Division Produces Components for a Buying Division That

Multiple Choice

A selling division produces components for a buying division that is considering accepting a special order for the products it produces. The selling division has excess capacity. The maximum price the buying division would be willing to accept is

A) the selling division's variable costs.
B) the buying division's outside purchase price.
C) the price that would allow the buying division to cover its incremental cost of the special order.
D) the price that would allow the selling division to maintain its current ROI.