The machining division of ITA International has a capacity of 2,390 units. Its sales and...
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Accounting
The machining division of ITA International has a capacity of 2,390 units. Its sales and cost data are:
Selling price per unit
$
85
Variable manufacturing costs per unit
30
Variable selling costs per unit
5
Total fixed manufacturing overhead
197,100
The machining division is currently selling 2,190 units to outside customers, and the assembly division of ITA International wants to purchase 400 units from machining. If the transaction takes place, the variable selling costs per unit on the units transferred to assembly will be $0/unit, and not $5/unit. What should be the transfer price in order not to affect the machining divisions current profit? (Round answer to 2 decimal places e.g. 5.25.)
Minimum transfer price
$
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