ASSIGNMENT to purchase the engine component from external suppliers because of the recent installation of some highly specialized equipment and the resulting high depreciation manager appeals to top management of Kelly-Elias for support in the dispute with division C and supplies the following operating data: price to S135, division C's manager decides unit in the open C's annual purchases of the tractor-engine component A's variable cost per unit of the tractor-engine component A's fixed cost per unit of the tractor-engine component 1,900 units $ 105 $ 25 1. Assume that there are no alternative uses for internal facilities of division A. Determine whether the company as a whole will benefit if division C purchases the component from external suppliers for $115 per unit. What should the transfer price for the component be set at so that division managers acting in their own divisions' best interests take actions that are also in the best interest of the com- pany as a whole? 2. Assume that internal facilities of division A would not otherwise be idle. By not producing the 1,900 operations that would result in annual cash-operating savings of $22,800. Should division C purchase from external suppliers? Show your computations. 3. Assume that there are no alternative uses for division A's internal facilities and that the price from out- siders drops $15. Should division C purchase from external suppliers? What should the transfer price for the component be set at so that division managers acting in their own divisions' best interests take units for division C, division A's equipment and other facilities would be used for other production actions that are also in the best interest of the company as a whole? 22-26 Transfer pricing problem (continuation of 22-25). Refer to Exercise 22-25. Assume that division Determine whether Kelly-Elias will benefit if division C purchases the 1,900 units from external suppliers at $115 per unit. Show your computations. A cant sell the 1,900 units to other customers at $137 per unit, with variable marketing cost of $2 per unit. ASSIGNMENT to purchase the engine component from external suppliers because of the recent installation of some highly specialized equipment and the resulting high depreciation manager appeals to top management of Kelly-Elias for support in the dispute with division C and supplies the following operating data: price to S135, division C's manager decides unit in the open C's annual purchases of the tractor-engine component A's variable cost per unit of the tractor-engine component A's fixed cost per unit of the tractor-engine component 1,900 units $ 105 $ 25 1. Assume that there are no alternative uses for internal facilities of division A. Determine whether the company as a whole will benefit if division C purchases the component from external suppliers for $115 per unit. What should the transfer price for the component be set at so that division managers acting in their own divisions' best interests take actions that are also in the best interest of the com- pany as a whole? 2. Assume that internal facilities of division A would not otherwise be idle. By not producing the 1,900 operations that would result in annual cash-operating savings of $22,800. Should division C purchase from external suppliers? Show your computations. 3. Assume that there are no alternative uses for division A's internal facilities and that the price from out- siders drops $15. Should division C purchase from external suppliers? What should the transfer price for the component be set at so that division managers acting in their own divisions' best interests take units for division C, division A's equipment and other facilities would be used for other production actions that are also in the best interest of the company as a whole? 22-26 Transfer pricing problem (continuation of 22-25). Refer to Exercise 22-25. Assume that division Determine whether Kelly-Elias will benefit if division C purchases the 1,900 units from external suppliers at $115 per unit. Show your computations. A cant sell the 1,900 units to other customers at $137 per unit, with variable marketing cost of $2 per unit