Q4 part 1 of 2

Cobol Manulacturing makes a variety of products, neluding lawn mowers. Cobol's Lawn Mower Division can use a component, K32, manufactured by Cobol's Electrical DMision. The market price far K32 is $24 per unit. The variable cost per unit foc K32 in the Eloctrical Divieion is $15, while the absorption cost per unit is $17, The divisions at Cobof use a negotiated price stratefy to set transler poces between divisions. The Elecinical Division has excess capacity. What is the lowest acoeptable transler price to the Electrical Divaion? What is the highest acceptable transfer price that the Lawn Mower Division would pay? Explain yeur