Siddler Company manufactures power tools. The Electric Drill Division (an investment center) can purchase the motors for the drills from the Motor Division (another investment center) or from an outside vendor. The cost to purchase from the outside vendor is $28. The Motor Division also sells to outside customers. The motor needed by the Electric Drill Division sells for $33 to outside customers and has a variable cost of $21. The Motor Division has excess capacity. 21. 22. If Siddler Company allows division managers to negotiate transfer prices, what is the minimum amount the manager of the Motor Division should consider? What is the maximum transfer price the manager of the Electric Drill Division should consider? 21. If Siddler Company allows division managers to negotiate transfer prices, what is the minimum amount the manager of the Motor Division should consider? The Motor Division has excess capacity, so the manager should consider a minimum transfer price of 22. What is the maximum transfer price the manager of the Electric Drill Division should consider? The maximum transfer price the manager of the Electric Drill Division should consider is $21, its variable cost per unit. $28, the price the Electric Drill Division can purchase the motor for from an outside vendor $33, the price that it can sell the motor to outside customers. Siddler Company manufactures power tools. The Electric Drill Division (an investment center) can purchase the motors for the drills from the Motor Division (another investment center) or from an outside vendor. The cost to purchase from the outside vendor is $28 The Motor Division also sells to outside customers. The motor needed by the Electric Drill Division sells for $33 to outside customers and has a variable cost of $21. The Motor Division has excess capacity 21. 22. If Siddler Company allows division managers to negotiate transfer prices, what is the minimum amount the manager of the Motor Division should consider? What is the maximum transfer price the manager of the Electric Drill Division should consider? 21. If Siddler Company allows division managers to negotiate transfer prices, what is the minimum amount the manager of the Motor Division should consider? The Motor Division has excess capacity, so the manager should consider a minimum transfer price of 22. What is the maximum transfer price the manager of the Electric Drill Division should consider? The maximum transfer price the manager of the Electric Drill Division should consider is $21, the Motor Division variable cost per unit S28, the price it can purchase the motor for from an outside vendor. $33, the price that the Motor Division can sell the motor to outside customers
