Exercise 12A-1 Transfer Pricing Situations [L012-51 [The following information applies to the questions displayed below) In each of the cases below, assume that Division X has a product that can be sold either to outside customers or to Division Y of the same company for use in its production process. The managers of the divisions are evaluated based on their divisional profits. Case Division X: Capacity in units 100,000 100,000 Number of units being sold to outside customers 100,000 80,000 $35 $50 Selling price per unit to outside customers $30 $20 Variable costs per unit $8 Fixed costs per unit (based on capacity) Division Y: Number of units needed for production 20,000 20,000 Purchase price per unit now being paid to an $47 $34 outside supplier