Hello - My professor gave an impromptu project to the class today with a due date of tomorrow. He has stated the project is relatively easy if we have been following lecture however the material presented is posing a challenge for me. Can you please assist me with putting this together? See docment attached.

CASE # 6 Hint: This case falls within the knowledge area of Transfer Pricing and costbenefit relationships. See Doc Sharing for detailed guidelines. The Scenario to you is as follows: The Nicholson and Cage Divisions are in the same company. Currently the Cage Division buys a part from the Nicholson Division for $82 per unit. The Nicholson Division wants to increase the price of the part to $100 per unit. Cage Division can buy the part for $94 from an outside supplier. The cost data for the part obtained from the Nicholson Division is below: Direct materials Direct labor $25.50 32.50 Variable indirect production Fixed indirect production 22.50 9.60 If Nicholson does not provide the parts to Cage, it will save one-fourth of the fixed indirect production costs. The Nicholson Division has excess capacity but no alternative uses of the facilities. Assuming: 1. The Nicholson Division has excess capacity but no alternative uses of the facilities. a) b) 2. From the standpoint of the company as a whole, should Cage Division continue to buy the part from Nicholson Division? Fully explain From the standpoint of Cage Division only, should Cage Division continue to buy the part from Nicholson Division? Fully explain Suppose now that The Nicholson Division has no idle capacity with alternatives a) From the standpoint of the company as a whole, should Cage Division continue to buy the part from Nicholson Division? Fully Explain. b) From the standpoint of Cage Division only, should Cage Division continue to buy the part from Nicholson Division? Fully Explain. All relevant concepts must be operationally defined in your presentation Note that, your outline must be submitted by the start of class on Saturday 10th June, 2011. _____________________________________________________________________