What should be the lowest acceptable transfer price

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Question - Division A of Harkin Company has the capacity for making 3,000 motors per month and regularly sells 2,130 motors each month to outside customers at a contribution margin of $62 per motor. The variable cost is $47 per motor. Division B of Harkin Company would like to obtain 1,400 motors each month from Division A. What should be the lowest acceptable transfer price from the perspective of Division A?

Reference no: EM133152225

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