Division L at Reiner Ltd. manufactures 17050 units of part #70, which it currently sells to outside customers. Selected data for part #70 are given below:

Unit selling price to outside customers

$88.58

Variable production cost per unit

54.19

Variable selling and administrative expense per unit

10.78

Total fixed production cost (based on a capacity of 19732 units per year)

$380000

Division K at Reiner Ltd. currently purchases 7559 units of part #70 from an outside supplier at a price of $96.00. Consideration is being given to buying internally rather than from the outside supplier. If an internal transfer takes place, it has been determined that variable S&A expense would be cut by one quarter for any sales made to Division K.What is the lowest acceptable transfer price from the perspective of Division L?

Select one:

a.$85.88

b.$77.51

c.$96.00

d.$69.42

PLEASE ANSWER ASAP :))))