Divisions that Build Lid has 4 divisions: Framework, Internal Engines and electronics and Painting and pe frame and when the frames a pleted th ind exterior fittings, ishing. The Framework division makes the y move their production to the Internal and xterior fittings division for fitting out the electric cars, From here the cars move to the Engines and electronics division to have all the top-secret electric car technology and engine parts adde sent to the Painting and polishing division to be completed and prepared ready Each division m: ject is considering what should be their internal transfer prices ing price to their outside following information is p elp managers with the Division [ Framew Internal exterior fittings Engines and tronics ating an hing he specialised nature of Divisic Build’s ca and electronics do consider selling the cars at this stage rather only the final products are sold to maximise the profits earnt from th plogy Each division has spare capacity as they wish to grow the business ta be a leader in this area of manufacturing Required: Briefly explain the general rule applicable for transfer pricing applying these case facts in your explanation. on, calculate the suggested range for transfer prices The Internal and exterior fittings division has received a special order for the car frames manufactured without engines or electronics due to the increasing popularity Divisions that Build’s final product cars. The Framework division has set their transfer price as $3,800 and the special arder is far 5,000 car frames at a price of $7,500 per frame. Explain whether and why the Internal and exterior fittings manager's would be likely to accept the special order? Show your working or calculations.W. Explain whether and why th aS You have just det Internal and exterior fittings manager's decision mined is in the best interests of Divisions that Build Ltd as a whole? Show your working or calculations v vide two recommendations for Divisions that Build Ltd to assist with dealing with special orders. Question 2 Ifthe target selling price is $120 and the target profit margin is a 40 per cent mark-u on cost, calculate the target cost Carwell has introduce: . What is the a new product with perc arget price of $150 arget cost of margin on sales?