Comm Devices (CD) is a division of Concord Communications, Inc. CD produces restaurant pagers and other personal communi

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Comm Devices (CD) is a divisionof Concord Communications, Inc. CD produces restaurantpagers and other personal communication devices. These devices aresold to other Concord divisions, as well as to othercommunication companies. CD was recently approached by the managerof the Personal Communications Division regarding a request to makea special emergency-response pager designed to receive signals fromanywhere in the world. The Personal Communications Division hasrequested that CD produce 11,700 units of this specialpager. The following facts are available regarding the Comm DevicesDivision.
Selling price of standard pager
Variable cost of standard pager
Additional variable cost of special pager
For each of the following independent situations, calculate theminimum transfer price, and determine whether the PersonalCommunications Division should accept or reject the offer.(a)The Personal Communications Division has offered to pay the CDDivision $108 per pager. The CD Division has no availablecapacity. The CD Division would have to forgo salesof 9,360 pagers to existing customers in order to meetthe request of the Personal Communications Division.(Note: The number of special pagers to be produceddoes not equal the number of existing pagers that would beforgone.) (Round answer to 2 decimal places, e.g.125.36.)
(b)The Personal Communications Division has offered to pay the CDDivision $150 per pager. The CD Division has no availablecapacity. The CD Division would have to forgo salesof 15,600 pagers to existing customers in order to meetthe request of the Personal Communications Division.(Note: The number of special pagers to be produceddoes not equal the number of existing pagers that would beforgone.)
(c)The Personal Communications Division has offered to pay the CDDivision $103 per pager. The CD Division has availablecapacity.