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Full Serve Inc, has a number of divisions. One division, Gamma, makes zippers needs 95,000 zippers per year. Gamma incurs the following costs for one
Full Serve Inc, has a number of divisions. One division, Gamma, makes zippers needs 95,000 zippers per year. Gamma incurs the following costs for one zipper that are used in the manufacture of boots. Another division, Delta, makes boots that use the zippers a Direct materials Direct labor Variable overhead Fixed overhead Total $0.25 0.22 0.97 1.40 $2.84 Full Serve has the capacity to make 960,000 zippers per year, but outside supplier for $4.00 each (the same price that Gamma receives). Assume that Full division sets it? due to a soft market, it only plans to produce and sell 630,000 zippers next year. Delta currently buys zippers from a Serve allows negotiated transfer pricing. What is the ceiling of the bargaining range and which a. $2.70; Gamma b. $3.50; Gamma c. $2.70; Delta d.$1.38; Gamma e. $4.00; Delta
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