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(Appendix 11A) Division A makes a part that it sells to customers outside of the company, Data concerning this part appear below Selling Price to

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(Appendix 11A) Division A makes a part that it sells to customers outside of the company, Data concerning this part appear below Selling Price to outside customers Variable cost per Unit Total Fixed Coats Capacity in Unita $40 $30 $10,000 20,000 Division of the same company would like to use the part manufactured by Division A in one of its products. Dision 3 currenty purchases a similar part made by an outside company for $38 per unit and would substitute the part made by OMsion A. Division requires 5,000 units of the part each period. Division A has ample capacity to produce the units for Dision B without any increase in fred costs and without cutting into sales to outside customers. Division A sells to Division rather than to outside customers, the variable cost per unit would be $1 tower What should be the lowest acceptable transfer price from the perspective of Division AY Multiple Choice 529 $30 $38 (Appendix 11A) Division X of Charter Corporation makes and sells a single product that is used by manufacturers of fortant trucks. Presently sellis 12,000 units per year to outside customers at $24 per unit. The annual capacity is 20.000 units, and the variable cost to make each unit is $16. Division of Charter Corporation would like to buy 10,000 units a year from Division X to use in its products. There would be no cost savings from transferring the units within the company rather than seling them on the outside market What should be the lowest acceptable transfer price from the perspective of Division X? Multiple Choice $16.00 $17.60 $2140 $24.00 (Appendix 11A) Division A of Harkin Company has the capacity for making 3.000 motors per month and regularly sells 1.950 motors each month to outside customers at a contribution margin of $62 per motor. The variable cost is $40 per motor Division of Harkin Company would like to obtain 1,400 motors each month from Division A. What should be the lowest acceptable transfer price from the perspective of Division A? Multiple Choice $15.50 $40.00 $55.50 $62.00

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