Freberg Company, a division of Dudge Cars, produces automotive batteries. Freberg sells thebatteries to its customers for $102 per unit. The variable cost per unit is $55, and fixed costs perunit are $16. Top management of Dudge Cars would like Freberg to transfer 30,000 batteries toanother division within the company.

1. If Freberg is operating at full capacity, what is the minimum transfer price that Freberg should accept?

2. If Freberg has sufficent excess capacity to provide the 30,000 batteries to the other division, what is the minimum transfer price that Freberg should accept?