Exercise M-16 (Part Level Submission) Crede Inc. has two divisions. Division A makes and sells...
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Exercise M-16 (Part Level Submission) Crede 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 $ 10.08 from an outside vendor. Division A needs 10,600 lamps for the coming year. Division B has the capacity to manufacture 51,000 lamps annually. Sales to outside customers are estlmated at 40,400 lamps for the next year. Reading lamps are sold at $ 11.94 each. Varlable costs are $ 6.74 per lamp and include $1.26 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 $82,800 Consider the following independent situations. What should be the minimum transfer price accepted by Division B for the 10,600 lamps and the maximum transfer price paid by Division A? (Round answers to 2 decimal places, e.g. 10.50.) Minimum transfer price accepted by Division B s Maximum transfer price paid by Division A per unit per unit Click if you would like to Show Work for this question: Open Show Work
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