impact increase or decrease

View Policies Current Attempt in Progress Waterways Corporation mass-produces a simple water control and timer set. To produce these units, the company incurred variable expenses of $1,819,800 and fixed expenses of $691,798. During 2020, it sold 674,000 units at an average selling price of $3.50 per unit. This was the combination of selling 337,000 units on the market for $4.30 each, and transferring 337,000 units to the installation divisions at variable cost. Top management had directed the use of this transfer price. Capacity for this unit was 714,000 units. Recently, Ryan Smith, the plant manager, was approached by a new customer who offered to pay $4.35 per unit for 58.000 units. Ryan, thinking about his bonus that was based on the department's operating income, readily accepted the order. Now he had to break the news to Lee Williams, the service vice-president in charge of installations. In order to fill the new order, Ryan would have to reduce the installation division's quota by 18,000 units because he was not prepared to give up the margin he would receive from the outside sales. He suggested that Lee could purchase what he needed in the outside market. Suppose Ryan accepts the order. Determine what the impact would be on: Impact 1. the plant department income by $ $ and 2 the installation division operating income by $ 3. the company as a whole operating income by Attempts: 0 of 1 used Submit Answer Save for Later