6 (4 Marks) The Batool Division of Alisha Company makes fidget spinners which can either be sold to outside customers or transferred to the Hamza Division of Alisha Company. Last month the Hamza Division bought all 4,000 of its fidget spinners from the Batool Division for Rs.42 each. The following data are available from last month's operations for the Batool Division: Capacity Selling price per fidget spinner to outside customers Variable cost per fidget spinner when sold to outside customers 12,000 fidget spinners Rs.45 Rs.24 If the Batool Division sells fidget spinners to the Hamza Division, Batool can avoid Rs.2 per fidget spinner in sales commissions. An outside supplier has offered to supply fidget spinners to the Hamza Division for Rs.41 each. (a) Assume that the Batool Division has ample idle capacity to meet the demand of the Hamza Division. What should be the lowest acceptable transfer price from the perspective of the Batool Division? (b) Assume that Batool can sell 9,000 fidget spinners each month to outside consumers, what should be the lowest acceptable transfer price from the perspective of the Batool Division in this situation? Question 7 (2 Marks) On the last day of the financial year a division has operating assets with a total carrying amount (book-value) of Rs.300,000. The return on investment for the division is 25%. The division manager, Hassam wants to show better ROI to get bonus included in his salary. He is considering selling a non-current asset immediately before the year end. The non-current asset has a carrying amount of Rs.15,000 and will sell for a profit of Rs.5,000. What would be the Hassam's division's return on investment (ROI) immediately after the sale of the asset at the end of the year? Give your answer to 1 decimal place