Division A manufactures electronic circuit boards. The boards can be sold either to Division customers. Last year, the following activity was recorded in Division A: of the same company or to outside 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 20,000 16.ee 4.00 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 Division B incurred $100 in additional variable cost per instrument and then sold the instruments for $300 each. Required: 1 Prepare Income statements for last year for Division A. Division B, and the company as a whole 2 Answer is complete but not entirely correct Division A $2.500000 Division B 1.200.000 Company 3.700.000 Sales Expenses Added by the division Transfer price pad Total expenses 2.200.000 1.800.000 ,800.000 400.000 500.000 1 3.600.000 00.000 2.300,000 4.500.000 300.000) Ne operating income 1.100.000) P 300,000 $ 2. Assume that Division A's manufacturing capacity is 20.000 circuit boards per year. Next year. Division B wants to purchase 5.000 circuit boards from Division A. rather than only 4,000 components, as it did last year. Circuit boards of this type are not available from outside sources. What should Division A do from the standpoint of the company as a whole Continue to sell the circuit boards to outside customers Sell the 1.000 additional circuit boards to Division B