please show all work! Gracie Corporation includes two divisions, Engine Division and Lawnmower Division....
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Gracie Corporation includes two divisions, Engine Division and Lawnmower Division. The Engine Division makes specialized engines, including one that could be used by the Lawnmower Division. Costs for the engine are variable costs, $32; fixed costs, $40. The Engine Division has capacity to make 20,000 of the engines, and it is operating at capacity. It sells the engines to other companies for $104 each. If a sale were made to the Lawnmower Division, variable costs would be reduced by $8 per engine on those units. The Lawnmower Division needs 8,000 engines per year, and it has been purchasing them from another company for $90 each. Required: 1) If a transfer were to occur between Engine Division and Lawnmower Division, what is the maximum that Lawnmower Division should be willing to pay for the engines? 2) If a transfer were to occur between Engine Division and Lawnmower Division, what is the minimum price that Engine Division should be willing to accept
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