Waterway Company's Small Motor Division manufactures a number of small motors used in household and...
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Waterway Company's Small Motor Division manufactures a number of small motors used in household and office appliances. The Household Division of Waterway then assembles and packages such items as blenders and juicers. Both divisions are free to buy and sell any of their components internally or externally. The following costs relate to small motor LN233 on a per unit basis. $5.50 Fixed cost per unit Variable cost per unit Selling price per unit $11.10 $35.30 (a) Assuming that the Small Motor Division has excess capacity, compute the minimum acceptable price for the transfer of small motor LN233 to the Household Division. (Round answer to 2 decimal places, eg. 10.50.) Minimum transfer price $ per unit The Heating Division of Sunland International produces a heating element that it sells to its customers for $44 per unit. Its variable cost per unit is $20, and its fixed cost per unit is $10. Top management of Sunland International would like the Heating Division to transfer 14,800 heating units to another division within the company at a price of $32. The Heating Division is operating at full capacity. What is the minimum transfer price that the Heating Division should accept? Minimum transfer price $
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