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Boat Hull Manufacturing produces boat parts at the manufacturing facility in Virginia. The managerial accountant reported that Boat Hull Manufacturing manufactures parts to repair the

Boat Hull Manufacturing produces boat parts at the manufacturing facility in Virginia. The managerial accountant reported that Boat Hull Manufacturing manufactures parts to repair the container ships that import products from China. The main part that Boat Hull Manufacturing produces is the T24 part. The Port Department produces the T24 part at the Boat Hull Manufacturing facility in Virginia. The managerial accountant reported that the Deport Department could also produce the T24 part because there is excess capacity at the facility. The managerial accountant reported the current market price of the T24 part is $ 400

and reported the following manufacturing cost and expenses data:

Boat Hull Manufacturing

Manufacturing Costs and Variable Expense Report

T24 Part

Direct materials

$ 915

Direct labor

$ 187

Variable manufacturing overhead

$ 105

Fixed manufacturing overhead (current production level)

$ 180

Variable selling expenses (only incurred on sales to outside consumers)

$ 95

What is the highest transfer price the selling division would receive, and the buying division would pay, for the T24 part?

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