Additional Questions a) Following from requirement 2 where KoolAir needs 18,000 units of compressors, use the general transfer pricing rule to calculate the transfer price that Components Division should charge KoolAir for 1 compressor. b) Calculate the profit for Components Division, KoolAir Division and Palmer Industries if Components Division: i. Decides to sell 18,000 compressors to KoolAir based the transfer price calculated in (a). ii. Decides not to sell 18,000 compressors to KoolAir. c) If the bonus of the Components Division’s manager is based on divisional profits, given the calculations in part (b), will she/he accept or reject KoolAir’s offer? Is this an “goal congruent” decision? Explain
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