eBook Print Question 2 Not complete Mark 0.38 out of 100 P Flag question Negotiating a Transfer Price with Excess Capacity The Foundry Division of Findlay Pumps Inc. produces metal parts that are sold to the company's Assembly Division and to outside customers. Operating data for the Foundry Division for 2017 are as follows: To the Assembly outside Division Customers Support Total $2,600.000 200,000 parts x 56.50 300,000 parts x 57.10 Variables expenses at $360 Contribution maren Fandexpenses Net income "Allocated on the basis of unit sales (1.440,000) 1.160.000 (700.000) $460.000 $2.130.000 14.730,000 (1080,000) (2.520,000 1050000 2210.000 25,000) (1 225,000) $525.000 $985.000 The Assembly Division has just received an offer from an outside supplier to supply parts at $5.15 each. The Foundry Division manager is not willing to meet the $5.15 price. She argues that it costs her 55.35 per part to produce and sell to the Assembly Division, so she would show no profits on the Assembly Division sales. Sales to outside customers are at a maximum, 300,000 parts. a Verify the Foundry Division's $5.35 unit cost figure. Variable costs Rxed costs Total unit cost $ .6 1.75 5.35 Could the Foundry Division meet the 55.15 price and still show a net profit for sales to the Assembly Division? Show computations Use a negative sign only to indicate a net loss. Otherwise do not use negative signs with your answers. Sales to Assembly Division at 55.15 price 0% Variable costs Contribution margin Fixed costs Net profess Check