Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $1,350 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of $900 per unit.
Assume that a transfer price of $1,200 has been established and that 75,000 units of materials are transferred, with no reduction in the Components Division's current sales.
a. How much would Ziegler Inc.'s total operating income increase?
$
b. How much would the Instrument Division's operating income increase?
$
c. How much would the Components Division's operating income increase?
$
Answers (1)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of $1,350 per unit. ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
In a (n) contract, the seller guarantees to sell 100 percent of its goods to one buyer, and the buyer agrees to accept the entire quantity. In a (n) contract, the buyer agrees to purchase 100 percent of its goods from one seller.
Answers (1)
What should be included in an outline for an informative essay? Check all that apply. a thesis statement a final opinion several subtopics parenthetical citations secondary sources
Answers (2)
Griffin's Goat Farm, Inc., has sales of $796,000, costs of $327,000, depreciation expense of $42,000, interest expense of $34,000, a tax rate of 21 percent, and paid out $95,000 in cash dividends. What is the addition to retained earnings
Answers (1)
Several years ago, Cyclop Company issued bonds with a face value of $1,550,000 for $11,295,000. As a result of declining interest rates, the company has decided to call the bonds at a call premium of 5 percent over par.
Answers (1)
The pleasure satisfaction or happiness obtained from consuming a good or service is known as
Answers (2)
New Questions in Business
Which type of distribution is used when the producer wants more than one, but fewer than all, of the intermediaries who are willing to carry its products? A. exclusive B. selective C. intensive D. administered E. corporate
Answers (1)
Soap Company manufactures soap X and soap Y and can sell all it can make of either. Hours available to produce the products are the constrained resources.
Answers (1)
Sky High Seats manufactures seats for airplanes. The company has the capacity to produce 100,000 seats per year, but currently produces and sells 75,000 seats per year.
Answers (1)
All other things the same, in periods of increasing sales, net operating income will tend to increase more rapidly in a company with high variable costs and low fixed costs than in a company with high fixed costs and low variable costs.
Answers (1)
Greger Peterson is a senior manager at a public accounting firm making a base salary of $180,000 a year ($15,000 per month). Employers are required to withhold a 6.2% Social Security tax up to a maximum base amount and a 1.
Answers (1)