Problem
The Heating Division of Marigold International produces a heating element that it sells to its customers for $45 per unit. Its unit variable cost is $22, and its unit fixed cost is $8. Top management of Marigold International would like the Heating Division to transfer 15,100 heating units to another division within the company at a price of $27. The Heating Division is operating at full capacity. What is the minimum transfer price that the Heating Division should accept?