Part 1: The Axle Division of Becker Company produces axles for off-road sport ehicles. One-third of Axle's output is sold to an internal division of Becker; the remainder is sold to outside customers. Axle's estimated operating profit for the year is:

	Internal	External
Sales	266,000	551,000
Variable costs	171,000	261,000
Fixed costs	30,900	61,800
Operating profits	64,100	228,200
Unit sales	19,000	29,000

The internal division has an opportunity to purchase 19,000 axles of the same quality from an outside supplier on a continuing basis. The Axle Division cannot sell any additional products to outside customers. What is the minimum selling price that Axle should accept from the internal division? a. 9.00 b. 50.00 c. 14.50 d. 14.00

Part 2: The CJP Company produces 10,800 units of item S10 annually at a total cost of $214,000.

Direct materials	24,000
Direct labor	63,000
Variable overhead	49,000
Fixed overhead	78,000
Total	214,000

The XYZ Company has offered to supply 10,800 units of S10 per year for $22.00 per unit. If CJP accepts the offer, $8.00 of the fixed overhead would be saved. In addition, some of CJP's facilities could be rented to a third party for $19,000 per year. At what price would CJP be indifferent to XYZ's offer? a. 23.28 b. 22.35 c. 17.59 d. 24.28

Part 3: The following information relates to the Jax Company for the upcoming year.

	Amount	Per Unit
Sales	8,700,000	34.00
Cost of good sold	6,750,000	23.00
Gross margin	1,950,000	11.00
Operating expenses	740,000	2.90
Operating profit	1,210,000	8.10

The cost of goods sold includes $2,750,000 of fixed manufacturing overhead; the operating expenses includes $340,000 of fixed marketing expenses. A special order offering to buy 51,400 units for $29.00 per uti has been made to Jax. Fortunately, there would be no additional operating expenses assocaited with the order; however, Jax is operating at full capacity. How much will operating profits increase if Jax accepts the special order? a. 832,680 b. Operating profits will not increase as a result of accepting the special offer c. 606,756 d. 225,924 e. 416,340

Please show work on all answers.