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Division X makes a part that it sells to customers outside of the company. Data...

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Accounting

Division X makes a part that it sells to customers outside of the company. Data concerning this part appear below:

Selling price to outside customers $49
Variable cost per unit $45
Total fixed costs $482,000
Capacity in units 29,200

Division Y of the same company would like to use the part manufactured by Division X in one of its products. Division Y currently purchases a similar part made by an outside company for $49 per unit and would substitute the part made by Division X. Division Y requires 5,640 units of the part each period. Division X can already sell all of the units it can produce on the outside market. What should be the lowest acceptable transfer price from the perspective of Division X?

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