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 $0.95; full cost is $1.40. Comparable widgets sell on the open market for $1.90 each. Division A can produce up to 1.80 million widgets per year but is currently operating at only 50 percent capacity. Division B expects to use 90,000 widgets in the current year.

Required: 1. Determine the minimum and maximum transfer prices. (Enter your answers to 2 decimal places.)

2. Calculate Tulip Companys total benefit of having the widgets transferred between these divisions.

3. If the transfer price is set at $.95 per unit, determine how much profit Division A will make on the transfer. Determine how much Division B will save by not purchasing the widgets on the open market. (Round your answers to 2 decimal places.) (Find per unit for division A profit and Division B per unit savings.)

4. If the transfer price is set at $1.90 per unit, determine how much profit Division A will make on the transfer. Determine how much Division B will save by not purchasing the widgets on the open market. (Round your answers to 2 decimal places.) (Find per unit for division A profit and Division B per unit savings.)

5. What transfer price would you recommend to split the difference? (Round your answer to 3 decimal places.) (Find the mutually beneficial transfer price)