Developing Transfer Prices P 5. Cylinder Company has two
divisions, Glass Division and Instrument Division. For several years, Glass
Division has manufactured a special glass container, which it sells to
Instrument Division at the prevailing market price of $20. Glass Division
produces the glass containers only for Instrument Division and does not sell
the product to outside customers. Annual production and sales volume is 20,000
containers. A unit cost analysis for Glass Division showed the following:
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