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Thank you in advanced! The managers of Division Y and Division 2 both have a goal of maximizing divisional prot. Division Y has always purchased
Thank you in advanced!
The managers of Division Y and Division 2 both have a goal of maximizing divisional prot. Division Y has always purchased units from Division 2 at $74 per unit. Due to some large orders that were placed recently, Division 2 no longer has the capacity to produce units for Division Y. Division 2 is still willing to continue producing for Division Y, but wants to raise their price to $99 per unit. As a result, Division Y is now thinking about purchasing these units from an outside supplier for $83 per unit. Division Z could sell the same units to an external customer for $109. Division Y's annual requirement is 951 units. Division Z's costs are as follows: . Variable cost per unit: $71 . Total annual xed costs: $14,281 - These costs will be incurred regardless of whether a sale is made by Division 2 to Division Y or not. In this situation, what is the maximum transfer price? Round your nal answer to the nearest dollar. Do not use $ signs in your nal answer. Do not round intermediary answersStep by Step Solution
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