Only need the rest of req. 3 and req 4.

Wison Motorn, Inc., operates as a decentralized multidivision company. The Vandell division of Wilson Motors purchases most of its nirbags from the airbag division The airbag division's incremental cost for manufacturing the airbags is $80 per unit. The dirbag division is currently working at 70% of capacity. The current market price of the airbags is $130 per unit Read the requirements 3 ne whether tran If the two divisions were to negotiate a transfer price, what is the range of possible transfer prices? Evaluate this negotiated transfer pricing policy using the criteria of goal congruenco, evaluating division performance, motivating management effort and preserving division autonomy Instead of allowing negotiation, suppose that Wilson specifies a hybrid transfer price that 'splits the difference between the minimum and maximum prices from the divisions standpoint What would be the resulting transfer price for airbags? angruence ing division perf ing management 4. Incor $ 0/1) Requirement 3. If the two divisions were to negotiate a transfer price, what is the range of possible transfer prices? if the two divisions were to negotiate a transfer price, me range of possible transfer prices will be between SBO and $130 per unit. The airbag division will be willing to supply the airbags only of the transfer prion equals or exceeds 80. incremental costs The Vandel division will be willing to buy airbags from the airbag division only if the price does not $ 130 per airbag, the market price of the airbag Evaruto thin negotiated transfer pricing policy using the criteria of goat congruence, evaluating division performance, motivating management effort, and preserving division autonomy > xoood Goal congruence Evaluating division performance Motivating management effort Preserving division autonomy Determine whether transferring products internally at Incremental cost has the following properties and give a reason why. Goal congruence Yes The airbag division is not forgoing any external sales or contribution margin, Evaluating division performance No The transfer cont does not cover or excoed full costo Motivating management effort Yes Basing transfer prices on budgeted costs forces managers to control costs. Preserving division autonomy No Because the transfer price is rule based