Figure 20-1
Universe Industries Has Two Divisions: the Haley Division

Multiple Choice

Figure 20-1
Universe Industries has two divisions: the Haley Division and the Comet Division. Information about a component that the Haley Division produces is as follows: $\begin{array}{lr}\text { Sales } & £ 120 \text { per unit } \\\text { Variable manufacturing costs } & £ 30 \text { per unit } \\\text { Fixed manufacturing overhead } & £ 20 \text { per unit } \\\text { Expected sales in units } & 4,000 \text { units }\end{array}$ The Haley Division can produce up to 5,000 components per year. The Comet Division needs 200 units of the component for a product it manufactures.
-Refer to Figure 20-1. If the selling division did NOT have excess capacity, the minimum transfer price the selling division would be willing to accept is

A) £120.
B) £75.
C) £50.
D) £30.