Pacific Mill consists of two operating divisions, a Cutting division and the Assembly division The Cutting division prepares cords of timber at its sawmills, while the Assembly division prepares the cut cords of lumber into board-fact of finished wood (which is sold to various furniture manufacturers). During the most recent year the Cutting division prepared 100.000 cords of wood at a cost of $2,200, 000. All of this lumber was transferred to the Assembly division, where incremental costs of $12 per cord were added. Pacific Mill sold the 100.000 board-feet of finished wood for $5,800, 000. Required: What would the operating income for each of the two divisions be if the transfer price from Cutting to Assembly was set at the cord cost of $22 per cord? (Show calculations.) 2 What would the operating income for each of the two divisions be if the transfer price is set at $1 ft per cord? (Show calculations.) Since Cutting transfers all of its output internally (to Assembly), docs the manager of Cutting care what price is selected? Why? Should Cutting be treated as a cost center under the circumstances (rather than a profit center or investment center)? Explain