77. Underwood Company uses cost-based transfer pricing. Its Food Processing Division has a standard variable cost of $8.50 per case and allocated fixed overhead of $2.25. The Processing Division, which has excess capacity, sells its output to external customers for $12.00 per case. If Underwood uses full (or absorption) cost as its base, the transfer price charged to its Retail Division should be: A. $14.25. B. $12.00. C. $10.75. D. $8.50 plus a markup. E. negotiated between the managers of the Processing and Retail Divisions