Management would like to know which transfer pricing method will generate the highest gross profit for their new division based on the following estimated data: mk52

Total sales 70% of sales will be interdivisional sales Market price. Total operating costs ($7 per unit). Required: 200,000 units $10 per unit $1,400,000 Prepare a comparison of transfer pricing techniques using the above information. Assume 20% plus full costs when using the cost plus method. Also, assume a negotiated price of $8.50 per unit and a 10% markup when using dual prices.