Decision on transfer pricing Materiais used by the Instrument Division of Ziedier Inc. are currently purchased from outside suppliers at a cost of 3251 per unit. However, the same materials are available from the Components Division The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $208 per unit. a. If a transfer price of $228 per unit is established and 39,000 units of materials are transferred, with no reduction in the Components Division's current sales, how much wouid Ziegier Inc.'s total operating income increase? 5[:i b. How much would the Instrument Division's operating income increase? 1i: c. How much would the Component; Division's operating income increase? s[:i