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High Sound Corporation manufactures car stereos. It is a division of Quality Motors, which manufactures vehicles. High Sound sells car stereos to Quality Motors, as
High Sound Corporation manufactures car stereos. It is a division of Quality Motors, which manufactures vehicles. High Sound sells car stereos to Quality Motors, as well as to other vehicle manufacturers and retail stores. The following information is available for High Sound's standard unit car stereo's costs: variable cost per unit $34, fixed cost per unit $23, and selling price to outside customers $91. Quality Motors currently purchases a standard unit car stereo from an outside supplier for $81. Because of quality concerns and to ensure a reliable supply, the top management of Quality Motors has ordered High Sound to provide 20,700 units per year at a transfer price of $34 per unit. High Sound is already operating at full capacity. High Sound can avoid $6 per unit of variable costs by selling the unit internally. (a) Determine the minimum transfer price that High Sound should accept. $ Minimum transfer price Save for Later (b) The parts of this question must be completed in order. This part will be available when you complete the part above
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