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11. What would be the minimum price that Division A would accept in order to make this transfer? What is the largest amount that Division B is willing to pay? 12. What if there were costs savings to Division A of $25 per unit if they transferred the units internally. NOW what would be their minimum acceptable price? 13. What happens if the transfer price is set at $150 per unit? Is there now a balance between goal congruence and autonomy? (That is, can the divisions act as they wish and STILL meet the goals of the company overall?) 14. Assuming your answer to number 10 above is "no", is there a negotiated transfer price solution so that there will be goal congruence and autonomy? (That is, is there a price that can be negotiated between the two divisions that will meet the individual goals of the divisions AND the goals of the company?) company?) 15. How might income taxes play a role in determining the transfer price of goods and services between divisions? divisions? has two divisions, A and B, which manufacture bicycles. Division A produces the bicycle frame, and Division B assembles the rest of the bicycle. There is a market for both the bicycle frame produced by Division A, and the final product. Each division is treated as a profit center and have complete autonomy in setting transfer prices and in deciding how much, if any, units to produce. The transfer price for the bicycle frame has been set by company headquarters at the current market price of $200. This is the same price that Division B would have to pay on the open market, if it wished to obtain the frames elsewhere, versus getting them from Division A. The following data is available for normal production of both frames and completed bicycles: The manager of Division B has made the following calculation for his division