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Answer the Following Questions Using the Information Below

Question 4

Multiple Choice

Answer the following questions using the information below:
Division A sells ground veal internally to Division B, which in turn, produces veal burgers that sell for $10 per pound. Division A incurs costs of $1.25 per pound while Division B incurs additional costs of $5.00 per pound.
-What is Division A's operating income per burger,assuming the transfer price of the ground veal is set at $2.00 per burger?


A) $0.75
B) $1.50
C) $2.25
D) $3.00

Correct Answer:

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