The Pole Division of Hillyard Company produces poles which can be sold to outside customers or transferred to the Flag Division of Hillyard Company. Last year the Flag Division bought 50,000 poles from Pole at $2.50 each. The following data are available for last year's activities in the Pole Division: Capacity in units ........... 400,000 poles Quantity sold to outside customer's ....................."; 350,000 poles Selling price per pole to outside customers .......... $3.00 Total variable costs per pole.................... $2.00 Fixed operating costs................ $200,000 In order to sell 50,000 poles to the Flag Division, the Pole Division must give up sales of 30,000 poles to outside customers. That is, the Pole Division could sell 380,000 poles each year to outside customers (rather than only 350,000 poles as shown above) if it were not making sales to the Flag Division. According to the formula in the text, what is the lowest acceptable transfer price from the viewpoint of the selling division? Select one: O a. $2.50 O b. $2.00 O c. $2.60 O d. $3.00Elem Corporation produces a single product. The cost of producing and selling a single unit of this product as the company's normal activity level of 31,000 units per month is as follows: Direct Material $10.89 Direct Labor $9.78 Variable Manufacturing Overhead $2.19 Fixed Manufacturing Overhead $13.07 Variable selling and administrative expense $2.49 Fixed selling and administrative expense $9.24 The normal selling price of the product is $62.91 per unit. Direct labor is a variable cost. An order has been received from an overseas customer for 2,100 units to be delivered this month at a special discounted price. This order would have no effect on the company's normal sales and would not change the total amount of the company's fixed costs. The variable selling and administrative expense would be $0.23 less per unit on this order than on normal sales. Consider three different situations: PART A : Suppose there is not enough idle capacity to produce all of the units for the overseas customer and accepting the special order would require cutting production of 800 units for regular customers. The minimum acceptable price per unit for the special order is, to the nearest cent, $ 39.43