Question: Please help with the last question. What other qualitative factors might need to be?considered? (Fill in the blanks) 1st box: Chips Division / customers
Please help with the last question. "What other qualitative factors might need to be?considered?" (Fill in the blanks)
1st box: Chips Division / customers / external supplier of chips
2nd box: profitably in the long term / profitably in the short term / unprofitably
3rd box: extend the pricing / return to its external supplier

TX Electronics is a manufacturer with two departments: Computer Chips and Cell Phones. The computer chip that is produced in the Chips Department can be sold to customers at $6.75 per chip. The costs associated with the computer chips are as follows: (Click the icon to view the costs.) The Cell Phone Department has been purchasing the chips that it needs for $4.50 per chip from Chip World, but the manager was thinking that if the Chips Department could supply the chips for less than what Chip World is asking, then it would arrange a transfer between departments instead of giving the business to an external company. If the Cell Phone Department needs 180,000 computer chips and current production in the Chips Department is 360,000 chips, should a transfer take place? If so, at what price? (Note: For internal transfers, the selling and administrative costs are reduced to $0.85 per unit.) What other qualitative factors might need to be considered? First, let's determine if a transfer should take place. Begin by determining the minimum transfer price. The minimum transfer price is $ 3.6 The internal transfer should take place. The price for the internal transfer should fall between $ 3.60 and $ 4.50 . What other qualitative factors might need to be considered? Other factors to consider would be the relationship that the Cell Phone Division has with its Chips Division If the Chips Division is only able to transfer chips profitably in the long term . will the Cell Phone Division be able to extend the pricing for additional orders? i Costs X Variable manufacturing costs $ 2.75 Variable selling and administrative costs . . . $ 1.40 Capacity . . . 600,000 units Current production . ... . . . . . . . . . . . . . . . . . 600,000 units Print Done
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