Performance measurement

I do not have the Kaplan Kit (only the BPP Revision Kit). If the question is labelled as being from a past real exam then tell me the name of the question and which exam - then I will be able to find it because I do have all the past exam questions.

It's from JUNE 2018, the Portable garage Co. Could you explain the (b) part of the question?

Also from September/December 2017 Sports Co Could you explain the calculation of controllable profit as to why have we included depreciation and the head office cost?

The most B will be prepared to pay for adaptors is $13 because this is what they cost if bought externally. A is better selling externally for $15 than selling to B for only $13. However the external demand is 200,000 but A is capable of producing 350,000. A will therefore sell 200,000 externally. The remaining 150,000 they will be prepared to sell to B at a price they both agree on (which must be less that $13). B will then buy 150,000 from A and buy the remaining 30,000 (because the demand for the batteries is 180,000) externally.