?Truball Incorporated which manufactures sports equipment, consists of several operating divisions. Division A has decided to go outside the company to buy materials because division B plans to increase its selling price for the same materials to $$200.$ ?Information for division A and division B follows:

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Outside price for materials $ $170$ ?

Division A$$s annual purchases $12,000$ ?units

Division B$$s variable costs per unit $ $160$ ?

Division B$$s fixed costs, per year $ $1,290,000$ ?

Division B$$s capacity utilization $100\%$ ?

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Required:

$1.$ ?Assume that division B cannot sell its materials to outside buyers. Calculate the net cost or benefit to the company as a whole if Division A purchases the materials outside the company.

$2-$a$.$ ?Assume that division B can save $$210,000$ ?in fixed costs if it does not manufacture the material for Division A$.$ ?Calculate the net cost or benefit to the company as a whole for A to purchase outside the company.

$2-$b$.$ ?From the standpoint of the effect of the transaction on the company as a whole, should Division A purchase from the outside market?

$3-$a$.$ ?Assume the situation in Requirement $1.$ ?If the outside market value for the materials drops $$22,$ ?calculate the net cost or benefit to the company as a whole for A to purchase outside the company.

$3-$b$.$ ?From the standpoint of the effect of the transaction on the company as a whole, should Division A purchase from the outside market?