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Limar, Inc. manufactures three different motors AX, BX, and CX. Data on the motors is presented below:

Budget Information:	AX	BX	CX
Inventory units, January 1, 2022	2,000	2,200	2,400
Production units in 2022	3,600	3,400	3,000
Units sold in 2022	3,300	3,000	3,600
Production units in 2023	4,500	3,200	3,400
Estimated Inventory units, December 31, 2023	2,300	1,600	2,000

Cost and Production Information:

Selling price	$620	$560	$450
Unit variable cost	$360	$200	$240
Machine-hours per unit	8	9	7
Avoidable fixed costs, if product line is not produced	$240,000	$278,000	$255,000

Limars production capacity is 80,200 machine-hours per year.

Limar is currently facing a business decision in 2023:

KoCo, the Korean subsidiary of Limar, currently purchases 6,000 units of a simpler version (AX-N) of AX, from its local supplier at $560 each. If Limar was to make AX-N, the company estimates that AX-N would result in variable costs of $320 per unit and will require only 6 machine hours per unit to manufacture. Furthermore, Limar will invest in a new stamping machine solely for the production of AX-N for a fixed cost of $480,000. If Limar produces 6,000 units for KoCo, it will not produce and sell AX to compete with KoCo.

Given the machine hour constraint, answer the following questions:

Number of hours required for AX:	hours
Number of hours required for Special Order (AX-N):	hours
Impact on BX (enter an absolute number for positive, and a bracket number for negative):	hours
Impact on CX (enter an absolute number for positive, and a bracket number for negative):	hours

Limar is considering taking the special order. Please answering the following questions:

What is the benefit from the sale of AX-N?	$
What is the cost from not selling AX?	$
What is the Opportunity Cost from other products?	$
What is the minimum transfer price per unit of AX-N?	$

If Limar pays a higher tax rate than KoCo, to reduce overall taxes, what should the transfer price be? (High, medium or low?)

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