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:

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 $280 in additional variable cost per instrument and then sold the instruments for $620 each.

Required:

1. Calculate the net operating incomes earned by Division A, Division B, and the company as a whole.

2. Assume Division As manufacturing capacity is 20,100 circuit boards. Next year, Division B wants to purchase 5,500 circuit boards from Division A rather than 4,500. (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?

$ $ 184 113 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 B 20,100 15,600 4,500 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 income Complete this question by entering your answers in the tabs below. Required 1 Required 2 Assume Division A's manufacturing capacity is 20,100 circuit boards. Next year, Division B wants to purchase 5,500 circuit boards from Division A rather than 4,500. (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 to sell them to outside customers? Show less Continue to sell the additional 1,000 circuit boards to outside customers. Sell the 1,000 additional circuit boards to Division B