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Question(s) / Instruction(s):

Division A sells soybean paste internally to Division B, which in turn, produces soybean burgers that sell for $5 per pound.  Division A incurs costs of $0.80 per pound while Division B incurs additional costs of $3.00 per pound.

What is Division A\'s operating income per pound, assuming the transfer price of the soybean paste is set at $1.25 per pound?

A.            $0.45

B.            $0.875

C.            $1.250

D.            $1.625

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