The Heating Division of KLM International produces a heating element that it sells to its...
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The Heating Division of KLM International produces a heating element that it sells to its customers for $43 per unit. Its variable cost per unit is $18, and its fixed cost per unit is $10. Top management of KLM International would like the Heating Division to transfer 15,350 heating units to another division within the company at a price of $26. The Heating Division is operating at full capacity. Assume that the units being requested are special high-performance units, and that the division's variable cost would be $28 per unit. What is the minimum transfer price that the Heating Division should accept?
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