Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Can you please show me what I did wrong for total company sales? I thought I just had to add Div A sales and Div

Can you please show me what I did wrong for total company sales? I thought I just had to add Div A sales and Div B.image text in transcribed

Division A manufactures electronic circuit boards. The boards can be sold either to Division B of the same company or to outside customers. Last year, the following activity occurred in Division A: $ $ 183 111 Selling price per circuit board Variable cost per circuit board Number of circuit boards: Produced during the year Sold to outside customers Sold to Division B 21,300 14,600 6,700 Sales to Division B were at the same price as sales to outside customers. The circuit boards purchased by Division B were used in an electronic instrument manufactured by that division (one board per instrument). Division B incurred $230 in additional variable cost per instrument and then sold the instruments for $670 each. Required: 1. Calculate the net operating incomes earned by Division A. Division B, and the company as a whole. 2. Assume Division A's manufacturing capacity is 21,300 circuit boards. Next year, Division B wants to purchase 7,700 circuit boards from Division A rather than 6,700. (Circuit boards of this type are not available from outside sources.) From the standpoint of the company as a whole, should Division A sell the 1,000 additional circuit boards to Division B or continue to sell them to outside customers? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Calculate the net operating incomes earned by Division A, Division B, and the company as a whole. Division Division B Total Company $ 4,489,000$ 8,386,900 Sales 3,897,900 Expenses: Added by the 2,364,300 1,541,000 3,905,300 division 0 1,226,100 Transfer price paid Total expenses Net operating income 2,364,300 3,905,300 2,767,100 $ 1,721,900 $ 4,481,600 1,533.600

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions