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Scenario 3 Green Grass Co., a division of Lawn Supplies, Inc., produces lawnmowers, Green Grass sells its lawnmowers to home improvement stores, as well as

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Scenario 3 Green Grass Co., a division of Lawn Supplies, Inc., produces lawnmowers, Green Grass sells its lawnmowers to home improvement stores, as well as to Lawn Supplies, Inc. The following information is available for Green Grass' mowers: Lawn Supplies, Inc, can purchase comparable lawnmowers from an outside supplier for $810. In order to ensure a reliable supply, the management of Lawn Supplies, Inc. ordered Green Grass to provide 65,000 lawnmowers per year at a transfer price of $810 per unit. Green Grass is currently operating at full capacity. It could avoid $50 per unit of variable selling costs by selling internally. Question a) Calculate the minimum transfer price that Green Grass should be required to accept b) Calculate the increase (decrease) in contribution margin for Lawn Supplies, Inc. for this transfer

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