Exercise M-16 (Part Level Submission) Crede Inc. has two divisions. Division A makes and sells student desks. Division 8 manufactures and sells reading lamps. Each desk has a reading lamp as one of its components. Division A can purchase reading lamps at a cost of 10.08 from an outside vendor. Division A needs 10,600 lamps for the coming year Division B has the capacity to manufacture 51,000 lamps annually. Sales to outside customers are estimated at 40,400 lamps for the next year. Reading lamps are sold at $ 11.94 each. Vanable costs are 6.74 per lamp and include $1.26 of variable sales costs that are not incurred if lamps are sold internally to Division A. The total amount of fixed costs for Division B is $ 82,800 Consider the following independent situations. Your answer is correct. What should be the minimum transfer price accepted by Division B for the 10,600 lamps and the maximum transfer price paid by Division A? (Round answers to 2 decimal places, e.g. 10.50.) Minimum transfer price accepted by Division B 5.48 per unit Maximum transfer price paid by Division A 10.08 per unit Click if you would like to Show Work for this question: Open Show Work SHOW SOLUTION SHOW ANSWER LINK TO TEXT VIDEO: SIMILAR EXERCISE Attempts: 1 of 5 used Suppose Division B could use the excess capacity to produce and sell externally 19,800 units of a new product at a price of $7.63 per unit. The variable cost for this new product is $6.14 per unit. What should be the minimum transfer price accepted by Division B for the 10,600 lamps and the maximum transfer pnce paid by Division A? (Round answers to 2 decimal places, e.g. 10.50.) Minimum transfer price accepted by Division B s Maximum transfer price paid by Division A per unit per unit Click if you would like to Show Work for this