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Division A manufactures electronic circuit boards that can be sold to Division B of the same company or to outside customers. Last year, the following
Division A manufactures electronic circuit boards that can be sold to Division B of the same company or to outside customers. Last
year, the following activity occurred in Division A:
Sales to Division B were at the same price as sales to outside customers. The circult boards purchased by Division B were used in an
electronic instrument manufactured by that division one board per instrument Division B incurred $ in additional varlable cost per
Instrument and then sold the instruments for $ each.
Required:
Calculate the net operating incomes earned by Division A Division B and the company as a whole.
Assume Division As manufacturing capacity is circult boards. Next year, Division B wants to purchase circuit boards
from Division A rather than 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 additional circult boards to Division B or continue selling them to outside
customers?
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Calculate the net operating incomes earned by Division A Division B and the company as a whole.
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