Division A manufactures electronic circuit boards. The boards can be sold either to Division B of...
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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: Selling price per circuit board. $177 Variable cost per circuit board. $112 Number of circuit boards: Produced during the year 20,300 Sold to outside customers Sold to Division B 15,100 5,200 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 $290 in additional variable cost per Instrument and then sold the instruments for $650 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 20,300 circuit boards. Next year, Division B wants to purchase 6,200 circuit boards from Division A rather than 5,200. (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? 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. Sales Division A Division B Total Company 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: Selling price per circuit board. $177 Variable cost per circuit board. $112 Number of circuit boards: Produced during the year 20,300 Sold to outside customers Sold to Division B 15,100 5,200 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 $290 in additional variable cost per Instrument and then sold the instruments for $650 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 20,300 circuit boards. Next year, Division B wants to purchase 6,200 circuit boards from Division A rather than 5,200. (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? 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. Sales Division A Division B Total Company
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