GinFizz Ltd. produces kitchen tools, and operates several divisions as profit centers. Division M produces a product that it sells to other companies for $16 per unit. It has a maximum capacity of 45,000 units per year. Variable manufacturing cost is $9 per unit, and variable marketing cost is $3 per unit. Total fixed manufacturing overhead is $200,000, and fixed marketing costs are $60,000.

Division N of GinFizz Ltd. is planning to produce an innovative new tool that requires the use of Division M's product (or one very similar). Division N will require 30,000 units of Division M's product. Currently, Division N can purchase a product equivalent to Division M's from Company X for $15 per unit. However, GinFizz Ltd. is considering transferring the necessary product from Division M to Division N.

Required:

a. Assume Division M is operating at full capacity of 45,000 units per year and Division N accepts no partial order. What would be the minimum and maximum transfer price? Should the transfer take place?

Question 4 (part 1 of 2) GinFizz Ltd. produces kitchen tools, and operates several divisions as profit centers. Division M produces a product that it sells to other companies for \\( \\$ 16 \\) per unit. It has a maximum capacity of 45,000 units per year. Variable manufacturing cost is \\( \\$ 9 \\) per unit, and variable marketing cost is \\( \\$ 3 \\) per unit. Total fixed manufacturing overhead is \\( \\$ 200,000 \\), and fixed marketing costs are \\( \\$ 60,000 \\). Division N of GinFizz Ltd. is planning to produce an innovative new tool that requires the use of Division M's product (or one very similar). Division \\( \\mathrm{N} \\) will require 30,000 units of Division M's product. Currently, Division \\( N \\) can purchase a product equivalent to Division M's from Company X for \\( \\$ 15 \\) per unit. However, GinFizz Itd. is considering transferring the necessary product from Division \\( M \\) to Division \\( N \\). equired: a. Assume Division \\( M \\) is operating at full capacity of 45,000 units per year and Division \\( N \\) accepts no partial order. What would be the minimum and maximum transfer price? Should the transfer take place