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I only need the LAST (5th) requirement answered!!! others were provided if needed to complete the problem! Thanks in advance, will thumbs up correct answers

I only need the LAST (5th) requirement answered!!! others were provided if needed to complete the problem! Thanks in advance, will thumbs up correct answers on the part needed!! image text in transcribed
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The Cutler Company is decentralized, and divisions are considered investment centers. Cutler has one division that manufactures oak dining room chairs with upholstered seat cushions. The Chair Division cuts, assembles, and finishes the oak chairs and then purchases and attaches the seat cushions. More info The Chair Division currently purchases the cushions for $22 from an outside vendor. The Cushion Division manufactures upholstered seat cushions that are sold to customers outside the company. The Chair Division currently sells 800 chairs per quarter, and the Cushion Division is operating at capacity, which is 800 cushions per quarter. The two divisions report the following information: Requirements 1. Determine the total contribution margin for Cutler Company for the quarter. 2. Assume the Chair Division purchases the 800 cushions needed from the Cushion Division at its current sales price. What is the total contribution margin for each division and the company? 3. Assume the Chair Division purchases the 800 cushions needed from the Cushion Division at its current variable cost. What is the total contribution margin for each division and the company? 4. Review your answers for Requirements 1,2 , and 3 . What is the best option for Cutler Company? 5. Assume the Cushion Division has capacity of 1,600 cushions per quarter and can continue to supply its outside customers with 800 cushions per quarter and also supply the Chair Division with 800 cushions per quarter. What transfer price should Cutler Company set? Explain your reasoning. Using the transfer price you determined, calculate the total contribution margin for the quarter. Requirement 5. Assume the Cushion Division has capacity of 1,600 cushions per quarter and can continue to supply its outside custome 800 cushions per quarter and also supply the Chair Division with 800 cushions per quarter. What transfer price should Cutler Company s your reasoning. Using the transfer price you determined, calculate the total contribution margin for the quarter. Cutler Company should set the transfer price at because the Chair Division would not be willing to pay more than the price for which it can purchase the cushions from an outside vendor. Requirement 2. Assume the Chair Division purchases the 800 cushions needed from the Cushion Division at its current sales price. What is the total contribution margin for each division and the company? Requirement 3. Assume the Chair Division purchases the 800 cushions needed from the Cushion Division at its current variable cost. What is the total contribution margin for each division and the company? (Enter "0" for any zero amounts.) Requirement 4. Review your answers for Requirements 1,2 , and 3 . What is the best option for Cuter Company? The best option for Cutler is By having the Chair Division purchase the cushions from an outside vendor, the company would generate in total contribution margin than if the division murchases cushions internally

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