Division P of Launch Corporation has the capacity for making 76,000 wheel sets per year and regularly sells 61,000 each year on the outside market. The regular sales price is $110 per wheel set, and the variable production cost per unit is $73. Division Q of Launch Corporation currently buys 31,000 wheel sets (of the kind made by Division P) yearly from an outside supplier at a price of $100 per wheel set. If Division Q were to buy the 31,000 wheel sets it needs annually from Division P at $95 per wheel set, the change in annual net operating income for the company as a whole, compared to what it is currently, would be:

• $760,000

• $245,000

• $137,000

• $610,000

• $837,000