Exercise 12A-3 Transfer Pricing Situations (LO12-5) [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 200,000 200,000 Division X: Capacity in units Number of units being sold to outside customers Selling price per unit to outside customers Variable costs per unit Fixed costs per unit (based on capacity) Division Y: Number of units needed for production Purchase price per unit now being paid to an outside supplier 200,000 160,000 75 60 U $ 40,000 86 $ 40,000 74