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Materials used by the instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $208 per unit. However, the same

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Materials used by the instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $208 per unit. However, the same materials are avalable from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $173 per-unit: Assume that a transfer price of $198 has been established and that 27,600 units of materials are transferred, with no reduction in the Components Division's current sales. a. How much would Ziegler Inci's total operating income increase? 1 b. How much would the Instrument Division's operating income increase? 3 c. How much would the Components Division's operating income increase? (4) d. Any transfer price will couse the total income of the company to 7, as long as the supplier division capacity is toward making materiats for products that are ultimately sold to the outside

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