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Ayayai Inc. has two divisions. Division A makes and sells student desks. Division B manufactures...

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Ayayai Inc. has two divisions. Division A makes and sells student desks. Division B manufactures and sells reading lamps. Each desk has a reading lamp as one of its components. Division A can purchase reading lamps at a cost of $10 from an outside vendor. Division A needs 12,400 lamps for the coming year. Division B has the capacity to manufacture 62,000 lamps annually. Sales to outside customers are estimated at 49,600 lamps for the next year. Reading lamps are sold at $12 each. Variable costs are $7 per lamp and include $3 of variable sales costs that are not incurred if lamps are sold internally to Division A. The total amount of fixed costs for Division B is $99,200. Consider the following independent situations. Suppose Division B could use the excess capacity to produce and sell externally 18,600 units of a new product at a unit selling price of $ 7. The unit variable cost for this new product is $ 5. What should be the minimum transfer price accepted by Division B for the 12,400 lamps and the maximum transfer price paid by Division A? Minimum transfer price accepted by Division B $ per unit Maximum transfer price paid by Division A $ per unit

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