The Sunrise Mattress Company uses transfer pricing for all work in process transfers between its divisions. Senior management believes that the transfer price is an important tool to motivate appropriate behavior and believes that each division should negotiate its prices when a transfer takes place. To make the mattresses that the company sells, the Spring Division buys processed cloth padding from an outside supplier. Cost information on the foam produced in the Foam Division is as follows: Raw material costs $10 per tonne Variable manufacturing costs $17 per tonne Fixed manufacturing costs $15 per tonne Variable selling costs $4 per tonne Outside selling price $40 per tonne Annual production capacity 100,000 tonnes The Foam Division currently produces and sells at its capacity. Instructions If the Spring Division were to change from cloth padding to foam padding for its mattresses, and wanted to buy internally, calculate the transfer price that the Foam Division would accept