Refer to Exercise E12.29@. The assembly division's absorption cost of a component is $510, which includes $60 of applied xed overhead costs. The transfer price has been set at $561,. which is the assembly division's absorption cost plus a 10 per cent markup. The electrical division has a special otter of $697.50 for its product. The electrical division incurs variable costs of $150 in addition to the page 6|]! transfer price for the assembly division's components. Both divisions currently have spare production capacity. Required: 1. Is the electrical division manager likely to want to accept or reject the special offer? Why? 2. Is this decision in the best interests of Electro Ltd as a Whole?I Explain. 3. How could the situation be remedied using the transfer price