PRINTER VERSION BACK NEXT Question 29 Arian International Corporation has two divisions, Division A and Division B. Division A produces a motor that sells for $96 per unit, with the following costs based on its capacity of 183,000 units: Direct materials Direct labour Variable overhead Fixed overhead $28 27 11 Division A is operating at 70% of normal capacity and Division B is purchasing 25,000 units of the same component from an outside supplier for $90 per unit. Calculate the benefit, if any, to Division A in selling to Division B the 25,000 units at the outside supplier's price. Benefit Calculate the lowest price Division A would be willing to accept. Lowest price If Division A is operating at full capacity, what would be the lowest transfer price that it is willing to accept? Lowest transfer price MacBook Pro