Q1) Parts Division sells Product A for $14.25 on outside market. Lately market for Product A has slowed down and there is idle capacity in Parts Division. Costs to make Product A as recorded by company's cost accounting system are:
|Variable manufacturing overhead
|Fixed manufacturing overhead
Assembly Division of same company requires a part which is just like Product A. Assembly Division can select whether to purchase Product A from outside supplier for $14.15 or purchase it internally from Parts Division. Determine the lowest transfer price Parts Division would accept for Product A?