In each of the cases below, assume that Division X has a product that can be sold either to outside customers or to Division of the same company for use in its production process. The managers of the divisions are evaluated based on their divisional profits: Case Division X: Capacity in units Number of units being sold to outside customers Selling price per unit to outside customers Variable costs per unit Fixed costs per unit based on capacity) Division Y: Number of units needed for production Purchase price per unt now being paid to an outside supplier 170,000 170,000 170,000 150,aee $ 575 40 $ 34 $ 23 $ 7 $ 5 20,000 52 $ 20.ee 39 $ Required: 1-a. Refer to the data in case A above Assume that $4 per unit in variable selling costs can be avoided on intracompany sales. Determine the transfer price of the selling division Translor prico Required: 1-a. Refer to the data in case A above Assume that $4 per unit in variable selling costs can be avoided on intracompany sales Determine the transfer price of the selling division Transfor price 1-b. If the managers are free to negotiate and make decisions on their own, will a transfer take place? O Yes 2-a. Refer to the data in case B above. In this case there will be no reduction in variable selling costs on intracompany sales. Determine the transfer price of the selling division Transfer price 2-a. Refer to the data in case B above. In this case there will be no reduction in variable selling costs on intracompany sales Determine the transfer price of the selling division. Transfer price 2-b. If the managers are free to negotiate and make decisions on their own, will a transfer take place? Yes O No 2-c. What is the range of transfer price the managers of both divisions should agree? The transfer price can be a lowest of and a highost of