AlDona group owns two subsidiaries North and South.

North produces and sells fabric; the cost structure is as the following:

Variable Cost 15$ per unit. Fixed annual cost is 200.000. The north can sell 10.000 units of fabric for 22 $ in the market.

The South requests 1000 units of fabric from the market for 20$ and then process is and sell it for 35 $

Requirements:

If we use 20% markup on total cost as a transferring price what is the transfer price?

If the North division sells only 9600 units to outsiders what are upper and lower limits?

he North division has 550 units idle capacity determine the upper and lower levels?