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Transfer Pricing, Iale Capscity Asgard Farms, Inc, has a number of divisions that produce jams and jellies, condiments and glassware. The Giassware Division manufactures a variety of botties that can be sold externally (to soft-drink and fulce bottiers) or internally to Asgard Farm's jams Division. Sales and cost data on a case of 24 basic 12 -ounce bottles are as follows: Practical capacity in cases 580,000 $06,000/580,000 During the coming year, the Glassware Division expects to sell 470,000 cases of this bottle. The Jams and Jelies Division currently plans to buy 90,180 cases on the outside market for $3.00 each. Bella Howard, manager of the Glassware Divislon, approached Paul Vining; manager of the Jams and Jellies Division, and offered to sell the 90.180 cases for $2.92 each. Bella explained to Paul that she can avold selling costs of $0.13 per case by selling internally and that she would splic the savings by offening 3 $0.08 discount on the usual price. Required: 1. What is the minimum transfer price that the Glassware. Division would be willing to accept? Round to the nearest cent. 5 per unit What is the maximum transfer price that the Jams and Jelilies Division would be willing to pay? Round to the nearest cent. s. per unit: Shousd an internal transfer take place? What would be the bencfit (or loss) to the firm as a whole if the internal transfer takes place? When required, round your answer to the nearest dollar. During the coming year, the Giassware Division expects to sell 470,000 cases of this bottie. The Jams and Jellies Division currently plans to buy 90,180 cases on the outside market for \$3.00 each. Bella Howard, manager of the Glassware Division, approached Poul Vining, manager of the Jams and Jelins Division, and offered to sell the 90,180 cases for $2.92 each, Bella explained to Peul that she can ovold seling costs of $0,13 per case by selling internally and that she would split the sawings by offering a $0,08 discount on the usual price. Required: 1. What is the minimum transfer price that the Glassware Division would be willing to accept? Round to the nearest cent. per unit What is the maximum transfer price that the Jams and Jelties Division would be wiling to pay? Round to the nearest cent. per unit Should an internal transfer take place? What would be the benefit (or loss) to the firm as a whole if the internal transfer takes place? When required, round your answer to the nearest dollar. 2. Suppose Poul knows that the Glassware Division has idie capacity. Do you think that he would agree to the transfer price of $2.92? Suppose be counters with an offer to pay $2,46. If you were Belia, would you be interested in this price? 3. Suppose that Asgard Farm's policy is that all intemal transfers take place at full manufacturing cost. What would the transfer price be? Round to the nearest cent. per unit Would the transfer take place

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