Problem $1-42($Algo$)$ Cost Data for Managerlal Purposes $($LO $1-3)$

Durham Parts $($DP$)$ makes a variety of products. It is organized in two divisions, Eastern and Western. The managers for each division

are paid, in part, based on the financial performance of their divisions. The Western Division normally sells to outside customers but,

on occasion, also sells to the Eastern Division. When it does, corporate policy states that the price must be cost plus $25$ percent to

ensure a "fair" return to the selling division. Western received an order from Eastern for $1,200$ units. Western's planned output for the

year had been $4,800$ units before Eastern's order. Western's capacity is $6,000$ units per year. The costs for producing those $4\mathrm{.}800$

units follow.

Requlred:

o$.$ If you are the manager of the Western Division, what unit cost would you ask the Eastern Division to pay?

b$.$ If you are the manager of the Eastern Division, what unit cost would you argue you should pay?

c$.$ What unit cost would you recommend for a sale of units from the Western Division to the Eastern Division?

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

If you are the manager of the Western Division, what unit cost would you ask the Eastern Division to pay?

Note: Do not round intermediate calculations. Round your final answer to $2$ decimal places.

Per unit cost $($plus $25\%)$