10-35 Maximum and Minimum Transfer Price and transfer components Sherwin Company makes bicycles. Various divisions make components also buy Dayton division for assembly into final products. The Dayton can wheels and it also sells external The division managers are free to negotiate transfer prices customers. divisions profit and as follows: and costs for the Toledo and Dayton divisions are Toledo Division 14 Sales price to external customers Internal transfer price Costs 10 Variable costs per wheel $320,000 Total fixed costs 64,000 wheels Budgeted production "Includes production for transfer to Dayton Dayton Division 170 Sales price to external customers Costs Wheels, per bicycle 85 other components, per bicycle 45 Other variable costs, per bicycle $640,000 Total fixed costs 16,000 bicycles Budgeted production ixed costs in both divisions will be unaffected by the transfer of wheels from Toledo to Dayton. 1. compute the maximum transfer price per wheel the Dayton division would be willing to pay to buy wheels from the Toledo division