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Martinez Corporation manufactures car stereos. It is a division of Berna Motors, which manufactures vehicles. Martinez sells car stereos to Berna, as well as to
Martinez Corporation manufactures car stereos. It is a division of Berna Motors, which manufactures vehicles. Martinez sells car stereos to Berna, as well as to other vehicle manufacturers and retail stores. The following information is available for Martinez's standard unit: unit variable cost $ unit fixed cost $ and unit selling price to outside customer $ Berna currently purchases a standard unit from an outside supplier for $ Because of quality concerns and to ensure a reliable supply, the top management of Berna has ordered Martinez to provide units per year at a transfer price of $ per unit. Martinez is already operating at full capacity. Martinez can avoid $ per unit of variable selling costs by selling the unit internally.
Answer each of the following questions.
a
Your answer is incorrect.
What is the minimum transfer price that Martinez should accept?
Minimum transfer price
$
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