e Edit View History Bookmarks Window Help Chapter 11A Help Save& Exit Submit Check my 4 Problem 11A-6 Basic Transfer Pricing [LO11-5] Alpha and Beta are divisions within the same company. The managers of both divisions are evaluated based on their own points division's retum on investment (RO Assume the following information relative to the two divisions Alpha Division Capacity in snita 57,000 299.00 102.000 208,000 Sunber of units mow being sold to Selling price per unit to outside variable costs per snit 57,000 299,000 77,000 208,000 ixed costs per unit (based on capacity) 28 s Sunber of units needed annually Purchase price now being paid t -400 58,000 Before any purchase discount Managers are free to decide if they will participate in any intenal transfers. All transfer prices are negotiated Refer to case 1 shown above. Alpha Division can avoid $3 per unit in commissions on any sales to Beta Division a. What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c What is the range of acceptable transfer prices @f ay) between the two divisions? will the managers probably agree to a ansfer? 5