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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: selling price per circuit board $ 188 variable cost per circuit board $ 123 Number of circuit boards: Produced during the year 20, 800 Sold to outside customers 14, 280 Sold to Division B 6, 680 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 20,800 circula boards. Next year, Division B wants to purchase 7,600 circuit boards from Division A rather than 6,600. (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 selling them to outside customers? 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 A Division B Total Company Sales Expenses Added by the division Transfer price paid Total expenses Net operating incomeDivision 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: Selling price per circuit board $ 188 Variable cost per circuit board $ 123 Number of circuit boards: Produced during the year 20, 808 Sold to outside customers 14, 260 Sold to Division B 6, 680 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 20,800 circuit boards. Next year, Division B wants to purchase 7,600 circuit boards from Division A rather than 6,600. (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 selling them to outside customers? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Assume Division A's manufacturing capacity is 20,800 circuit boards. Next year, Division B wants to purchase 7,600 circuit boards from Division A rather than 6,600. (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 1,000 circuit boards to Division B or continue selling them to outside customers? Show less A Continue to sell the additional 1,000 circuit boards to outside customers. )Sell the 1,000 additional circuit boards to Division B
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