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Calculator alman Inc. has a number of divisions, induding a Furniture Division and a Motel Division. The Motel Division owns and operates a line of
Calculator alman Inc. has a number of divisions, induding a Furniture Division and a Motel Division. The Motel Division owns and operates a line of budget motels cated along major highways. Each year, the Motel Division purchases furniture for the motel rooms. Currently, it purchases a basic dresser from an utside supplier for $40. The manager of the Furniture Division has approached the manager of the Motel Division about selling dressers to the Motel Division. The full product cost of a dresser is $29. The Furniture Division can sell all of the dressers it makes to outside companies for $40. The Motel Division needs 10,000 dressers per year; the Furniture Division can make up to 50.000 dressers per year. Also, assume that the company policy is that all transfer prices are negotiated by the divisions involved. Required: 1. What is the maximum transfer price? 40 Which division sets it? Motel Division 2. What is the minimum transfer price? 29 which division sets it? Furniture Division 3. Conceptual Connection: If the transfer takes place, what will be the transfer price? Does it matter whether or not the transfer takes place? Previous Next > 754 PM A y10/20 Check My Work 3 more Check My Work uses remaining mit e - 0 9
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