Hi! I couldn't understand the whole question. I would be so glad if you interpret it to me in detail. Thanks in advance.

PROBLEM Automobile Assembly Department Tire production department buys from outside SP $ 200 per tire $ 150 per tire Unit variable cost $ 120 (inside the $100) company S ... . .. . . TP = unit variable cost + Contribution margin that is lost from the sales of outside of company min. TP = $100 + ( 200 - 120 ) = $180 for tire department $5 80 Under this results fire department should sell to the outside and Assemble dep should by firm outside In other words, transfer inside the company will not be exist. we couldn't sell outside If we solve the problem under the assumption of idle copocity of the deportment , what would be the result? Min. TP= $100+ zero) = $100 Under this circumtances transfer price will be determined with negoiated method between minimum maximum $100 and $71SO 125