Answer Happy

Assume a company has two divisions, Division A and Division B. Division A has provided the following information regarding the one product that it manufactures and sells on the outside market: Selling price per unit (on the outside market) $ 60 Variable cost per unit $44 Fixed costs per unit (based on capacity) $4 Capacity in units 20,000 Division B could use Division A's product as a component part in the manufacture of 4,000 units of its own newly-designed product. Division B has received a quote of $61 from an outside supplier for a component part that is comparable to the one that Division A makes. If the company's divisional managers are evaluated based on their division's profits and Division A is currently selling 20,000 units on the outside market, what is the range of acceptable transfer prices between the two divisions? $58s Transfer prices $61 O $54 s Transfer price ≤ $61 $48s Transfer prices $61 $60s Transfer price ≤ $61