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The Custom Frame Shop has two divisions, Frames and Picture Prints, which are both organized as...

The Custom Frame Shop has two divisions, Frames and Picture Prints, which are both organized as profit centers; the Frames Division produces and sells frames to the Picture Prints Division and to outside customers. The Frames Division has total costs of $40, $20 of which are variable. The Frames Division is operating significantly below capacity and sells the fabric for $50. The Picture Prints Division has received an offer from an outsider vendor to supply all the frames it needs (10,000 frames) at a cost of $45. The manager of the Picture Prints Division is considering the offer but wants to approach the Frames Division first. What is the minimum transfer price from the Frames Division to the Picture Prints Division?

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