Dalin Inc. has two divisions: the Liquid Division that manufactures chocolate and sells the liquid both internally and externally; and the Bar Division that manufactures candy bars. The Bar Division currently purchases liquid chocolate from the Liquid Division for $6 a gallon. They recently received a bid from the Sly Company to provide liquid chocolate at a price of $4.50 a gallon. The Liquid Division does not want to meet the price, saying it will cost them money because their costs are $5 per gallon.

Required:
1) What is the Liquid Division Income: a) Currently
b) If it accepts the $4.50 price
c) If it does not accept the $4.50 price
2) What other issues need to be considered

Question

Dalin Inc. has two divisions: the Liquid Division that manufactures chocolate and sells the liquid both internally and externally; and the Bar Division that manufactures candy bars. The Bar Division currently purchases liquid chocolate from the Liquid Division for $6 a gallon. They recently received a bid from the Sly Company to provide liquid chocolate at a price of $4.50 a gallon. The Liquid Division does not want to meet the price, saying it will cost them money because their costs are $5 per gallon.
 
Required:
1) What is the Liquid Division Income: a) Currently
b) If it accepts the $4.50 price
c) If it does not accept the $4.50 price
2) What other issues need to be considered

Quizplus · Accepted Answer

The Answer of Dalin Inc. has two divisions: the Liquid Division that manufactures chocolate and sells the liquid both internally and externally; and the Bar Division that manufactures candy bars. The Bar Division currently purchases liquid chocolate from the Liquid Division for $6 a gallon. They recently received a bid from the Sly Company to provide liquid chocolate at a price of $4.50 a gallon. The Liquid Division does not want to meet the price, saying it will cost them money because their costs are $5 per gallon.
 
Required:
1) What is the Liquid Division Income: a) Currently
b) If it accepts the $4.50 price
c) If it does not accept the $4.50 price
2) What other issues need to be considered

Dalin Inc Has Two Divisions: the Liquid Division That Manufactures Chocolate