13. Obladi, Inc., manufactures 50,000 parts per year in the Parts division, which are transferred to the

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13. Obladi, Inc., manufactures 50,000 parts per year in the Parts division, which are transferred to the Finishing division. The Parts division’s costs are $3 per unit, plus $200,000 in fixed costs. The Finishing division’s costs are $20 per unit, plus the cost of the transferred parts, plus $500,000 in fixed costs. The market price for parts is $10. Obladi sets its transfer prices at full cost plus 10%.

Calculate the transfer price.

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