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In each of the cases below, assume that Division X has a product that can be sold either to outside customers or to Divisi Y
In each of the cases below, assume that Division X has a product that can be sold either to outside customers or to Divisi Y of the same company for use in its production process. The managers of the divisions are evaluated based on their divisional profits: 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
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