The Better Agriculture Group (BAG), which has a divisional structure, produces a range of products for the farming industry. Divisions B and C are two of its divisions Division B sells a fertiliser product (BF) to customers external to BAG. Division C produces a chemical (CC) which it could transfer to Division B for use in the manufacture of its product BF. However, Division C could also sell some of its output of chemical CC to external customers of BAG. An independent external supplier to the Better Agriculture Group has offered to supply Division B with a chemical which is equivalent to component CC. The independent supplier has a maximum spare capacity of 60,000 kilograms of the chemical which it is willing to make available (in total or in part) to Division B at a special price of 55 per kilogram Forecast information for the forthcoming period is as follows Division B: Production and sales of 350,000 litres of BF at a selling price of 120 per litre Variable conversion costs of BF will amount to 15 per litre. Fixed costs are estimated at 18,000,000. Chemical (CC) is used at the rate of 1 kilogram of CC per 4 litres of product BF. Division C: Total production capacity of 100,000 kilograms of chemical CC. Variable costs will be 50 per kilograms of CC. Fixed costs are estimated at 2,000,000 Market research suggests that external customers of BAG are willing to take up sales of 40,000 kilograms of CC at a price of 105 per kilogram. The remaining 60,000 kilograms of CC could be transferred to Division B for use in product EF. Currently no other market external to BAG is available for the 60,000 kilograms of CC. Required: (a) In order to maximise the profits of BAG, evaluate whether Division B should purchase CC from Division C or the equivalent of CC from the external supplier (b) (c) Assuming that the transfer price for CC is set at 80, assess whether this will lead to goal congruent decisions. Determine the range of transfer prices for CC that will result in goal congruent decisions by Divisions B and C