Because the alpha division is operating at capacity, the minimum price it will charge an internal division is the market price. See the correct answer for a complete explanation.
Because the alpha division is operating at capacity, the minimum price it will charge an internal division is the market price. The market price per unit is $50. If they were to charge less than the market price they would be losing money since they could sell that same unit to a different customer at a higher price.
Because the alpha division is operating at capacity, the minimum price it will charge an internal division is the market price. See the correct answer for a complete explanation.
Because the alpha division is operating at capacity, the minimum price it will charge an internal division is the market price. See the correct answer for a complete explanation.
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The minimum transfer price that should be charged to the beta division of the same company for each component is: