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Graham Motors manufactures specially tractors. It has two divisions a Tractor Division and a Tire Division. The Tractor Division can use the tres produced by

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Graham Motors manufactures specially tractors. It has two divisions a Tractor Division and a Tire Division. The Tractor Division can use the tres produced by the Tire Division. The market price por tire is 545. The Tire Division has the following costs per tre Click the icon to view the costs and additional information) Read the requirements Requirement 1. Assume that the Tiro Division has excess capacity, meaning that it can produce tires for the Tractor Division without giving up any of its current tre sales to outsiders. If Graham Motor has a negotiated transfer price policy, what is the lowest acceptable transfer price? What is the highest acceptable transfer price? (Assume the $5 includes only the variable portion of conversion costs) The lowest acceptable transfer price is the Tre Division's The highest acceptable transfer price is the Tire Division's Requirement 2 of Graham Motors has a cont plus transfer price policy of full absorption cont plus 30%, what would the transfer price bo? (Assume the 55 includes only the variable portion of conversion costs) Begin by selecting the formula to compute the transfer price under this strategy Cost-plus transfer price Ir Graham Motors has a complus transfer price policy of fuit absorption cout plus 30%, the transfer price would be Requirements. If the Tire Division is currently producing at capacity (meaning that it is selling every single tire has the capacity to produce), what would likely be the forest transfer price strategy to use? What would be the transfer price in this case? When a company is producing and selling at its capacity, the forest transfer price strategy to use is the strategy. In this case, the transfer price would be Direct material cost per tire $22 Conversion costs per tire $5 (Assume the $5 includes only the variable portion of conversion costs.) Fixed manufacturing overhead cost for the year is expected to total $120,000. The Tire Division expects to manufacture 40,000 tires this year. The fixed manufacturing overhead per tire is $3 ($120,000 divided by 40,000 tires)

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