Performance Evaluation No Transfer Market Transfer Price BOR CPAs, Inc. BOR CPAs, Inc. is a closely held corporation owned by three stockholders who used the initials of their last names to form the corporation's name: Cyrus Bailey, John Ogden, and Samuel Rogers. The firms Certified Public Accountants (CPAs) perform audits of both public companies and privately owned companies. BOR's CPAs also provide tax services to both individuals and businesses. The corporation is divided into two profit.centers: the Audit Division and the Tax Division. Each division is composed of two coat.centerz. The Auda Division is composed of two cost-center departments: Public Company Audits and Private Company Audits. The Tax Division is composed of two cost-center departments also: Individual Tax and Business Tax BOR, a decentralized organization, is interested in evaluating the pertormance of the two divisions. The stockholders are responsible for deciding on investment in the two divisions. Cyrus Bailey is in charge of the performance evaluation, and turns to you for assistance. Mr. Bailey is only interested in evaluating operations at the profit center (division) level, and not at the cost center (department) level Mr. Bailey is considering temporarily using some of the staff from the Tax Division to assist the Audit Division during the upcoming busy audit season, and would like to evaluate the effect of this on net income. The Tax Division is estimated to have 800 hours of excess capacity The unit for determining sales revenue in both divisions is the "engagement", which means the total agreed-upon work for a given client in either audit or tax for a given year The company charges on average a fee of $75,000 per audit engagement, and $15,750 per tax engagement The company has its own Payroll Office, which provides payroll services to both divisions and will allocate its total expenses to e two divisions as 2enac ,satmtnteha!9t