Division A at this time. Division A$\text{'}$s manager approaches Division B$\text{'}$s manager with a proposal to buy the equipment from Division B$.$ If it produces the cellular equipment that Division A desires, Division B will incur variable manufacturing costs of $\backslash (\backslash$$ $60\backslash )$ per unit. Relevant Information about Division B Sells $97,500$ units of equipment to outside customers at $\backslash (\backslash$$ $130\backslash )$ per unit Operating capacity is currently $\backslash (80\backslash \%\backslash )$; the division can operate at $\backslash (100\backslash \%\backslash )$ Variable manufacturing costs are $\backslash (\backslash$$ $70\backslash )$ per unit Variable marketing costs are $\backslash (\backslash$$ $8\backslash )$ per unit Fixed manufacturing costs are $\backslash$$$960,000$ Income per Unit for Division A $($assuming parts purchased externally, not internally from division B$)$ Required: $1.$ Division A proposes to buy $48,750$ units from Division B at $\backslash (\backslash$$ $75\backslash )$ per unit. What would be the effect of accepting this proposal on Division B$\text{'}$s operating income? What would be the effect on the operating income of Phoenix Incorporated as a whole? $2.$ Now suppose Division A could purchase from multiple suppliers and would accept partialshipment from Division B$.$ How many units should Division B sell to Division $\backslash ($ A $\backslash )$ at $\backslash (\backslash$$ $75\backslash )$ per unit, if any? What would be the price?

Complete this question by entering your answers in the tabs below.

Division A proposes to buy $48,750$ units from Division $\backslash ($ B $\backslash )$ at $\backslash (\backslash$$ $75\backslash )$ per unit. What would be the effect of accepting th on Division B$\text{'}$s operating income? What would be the effect on the operating income of Phoenix Incorporated as a

Effect on division B$\text{'}$s operating income

Effect on firm's operating income

Now suppose Division A could purchase from multiple suppliers and would accept partialshipment from Division B units should Division B sell to Division A at $\backslash (\backslash$$ $75\backslash )$ per unit, if any? What would be the effect on Division B$\text{'}$s operatin What would be the effect on the operating income of Phoenix Incorporated as a whole?

Division B capacity

Division B capacity to sell to Division A after all external sales Complete this question by entering your answers in the tabs below.

What is the range of transfer prices over which the divisional managers might negotiate a final transfer price?

The range of transfer price

to