Question 1 Global Tech Ine. (Global Tech) is a multinational corporation with two major profit centre divisions: Division A and Division B. Division A manufactures an electronic component C203, while Division B assembles and sells a finished electronic device FG311. Each unit of FG311 requires 2 units of C203 in its manufacturing process. Division A is required to satisfy the demand of Division B before it can sell externally. 203 is currently not available in the local external market. The only available external supply for C203 is through an agent who can source 203 at a price of $65 per unit from a manufacturer located in Russia. Logistics and delivery charges from this external supplier is at $5 per unit. There is an external market demand for both the C203 and FG311 produced by Division A and Division B respectively. Below is the data available for the two divisions based on the latest year: Division A Division B [ Production Capacity | 150.000 units | 50,000 units | Variable Cost per unit $50 $30* Fixed Costs $1,050.000 $1.500,000 External Selling Price per unit | $80 $200 External Demand 150,000 vnits | 50,000 vaits * Excluding the cost of C203 Required: (a) Prepare the income statements of Division A, Division B and Global Tech based on the following transfer pricing bases. (i) Marginal Costs. (i) Full Costs. (20 marks) {(b) Assuming that both divisions have the full autonomy to purchase and sell products internally as well as externally. analyse the optimal transfer price for Global Tech that will maximise its overall profits. if applicable. (5 marks)| () (d) Prepare the income statements of Division A, Division B and Global Tech based on the assumption that Division A and Division B do not transfer internally and evaluate the performance of each division. (15 marks) Critique other factors that Division B should consider before outsourcing C203 from the overseas supplier. (10 marks)