Tulip Company is made up of two divisions: A and B. Division A produces a widget that Division B uses in the production of its product. Variable cost per widget is $1.55; full cost is $2.60. Comparable widgets sell on the open market for $3.30 each. Division A can produce up to 3.00 million widgets per year but is currently operating at only 50 percent capacity. Division B expects to use 150,000 widgets in the current year. Required: 1.