10. Moona Company has two divisions. Division A produces a component that it transfers to Division B, who uses the component in its main product. Division A incurs $400 in variable costs to manufacture each component, as well as $100,000 in fixed costs. Division B incurs

$1,000 in variable costs in addition to the cost of the component to manufacture the main product, as well as $700,000 in fixed costs. Division A could sell the components on the market for $700. Moona sets its transfer prices at variable cost plus 40%.

Calculate the transfer price.