please answer questions 2 and 3

eBook Calculator Transfer Pricing Aulman Inc, has a number of divisions including a Furniture Division and a Motel Division. The Motel Division owns and operates a line of budget motels located along major highways. Each year, the Motel Division purchases furniture for the motel rooms. Currently, it purchases a basic dresser from an outside supplier for $40. The manager of the Furniture Division has approached the manager of the Motel Division about selling dressers to the Motel Division. The full product cost of a dresser is $29. While the Furniture Division has been operating at capacity (50,000 dressers per year) and selling them for $40 each, it expects to produce and sell only 40,000 dressers for $40 each next year. The Furniture Division incurs variable costs of $15 per dresser. The Motel Division needs 10,000 dressers per year; the Furniture Division can make up to 50,000 dressers per year. The company policy is that all transfer prices are negotiated by the divisions involved. Required: 1. What is the maximum transfer price? 40 Which division sets it? Motel Division 2. What is the minimum transfer price? 40 x Which division sets it? Furniture Division Check My Work 2 more Check My Work uses remaining Previous 1014 PM ADA VI/2020 eBook Calculator Required: 1. What is the maximum transfer price? $ 40 Which division sets it? Motel Division 2. What is the minimum transfer price? 40 X Which division sets it? Furniture Division 3. Suppose that the two divisions agree on a transfer price of $38. What is the benefit for the Furniture Division? For the Motel Division? For Aulman Inc.'as a whole? X Benefit to Furniture Division $ 210,000 Benefit to Motel Division $ 50,000 Benefit to company $ 260,000 X The selling division sets the minimum price and the buying division sets the maximum price Check My Work 2 more Check My Work uses remaining