Transfer Pricing: Custom Freight Systems (B) Assume all the information is the same as in Custom Freight

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Transfer Pricing: Custom Freight Systems (B) Assume all the information is the same as in Custom Freight Systems (A), but instead of receiving one outside bid, Logistics receives two. The new bid is from World Services for $195 per hundred.

World offered to use Air Cargo for air cargo. Air Cargo will charge World $155 per hundred pounds. The bids from Forwarders and United Systems remain the same as in part A, $210 and $185, respectively.

Which bid should Logistics Services take? Why?

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