The Volt Company has several autonomous, decentralized divisions including the Bohn and Odom divisions. Bohn Division manufactures a component that is used by the Odom Division in the production of a nished product. The component has a competitive outside market, that is, Bohn Division can sell all its production to the outside and Odom Division can buy all it needs from outside suppliers. Bohn Division is using the market price of $25 as its transfer price. Its variable cost is $15, and it is producing at full capacity. Odom Division has just received a request for a special order on its product but must give a discount on the regular selling price. Because it is operating at 50 percent of capacity, the division would like this order. The costs for the finished product are: Variable production costs: Component from Bohn Division $25 Other production costs 30 Fixed costs E Total production costs per unit $70 Variable selling and administrative _5 Total costs per unit 5; The purchaser is expecting a discount, and the sales people at Odom Division believe that a price of $62 will get the order. The manager of Odom Division has asked Bohn Division to reduce its transfer price to variable cost of $15 so that the total cost can be reduced to near the proposed selling price. Odom Division has capacity to manufacture 100,000 of the components. The special order is for 40,000 units, and Odom Division has sufcient capacity to fill the order. REQUIRED a. Calculate the change in operating income for Bohn Division if it reduces the transfer price to $15 for this one order of 40,000 units. (5 marks) b. Calculate the change in operating income for Odom Division if it takes the special order at a selling price of $62 and pays a transfer price of $15. (8 marks) c. Given that Bohn and Odom are autonomous, decentralized divisions, what is a reasonable transfer price which would facilitate this transfer. Justifyfexplain your recommended transfer price