The Consumer Products division of Sweet Dreams has been struggling lately. Management has noticed a steady level of losses being reported, and is concerned about how to turn the division around. The division manager reports that the production of Lamps is causing the issue. As part of an in-depth analysis, management wants you to evaluate the following possible solution: Sell unfinished products.
Management is aware that Sweet Dreams has the capability to become a supplier of the internal wiring of lamps for other manufacturing companies, rather than sell the lamps as finished goods to wholesalers. The following information contrasts the costs and revenues that would result from selling the lamps unfinished vs finishing them.
Which option would be the most profitable (without considering other qualitative issues)?

Question

The Consumer Products division of Sweet Dreams has been struggling lately. Management has noticed a steady level of losses being reported, and is concerned about how to turn the division around. The division manager reports that the production of Lamps is causing the issue. As part of an in-depth analysis, management wants you to evaluate the following possible solution: Sell unfinished products.
Management is aware that Sweet Dreams has the capability to become a supplier of the internal wiring of lamps for other manufacturing companies, rather than sell the lamps as finished goods to wholesalers. The following information contrasts the costs and revenues that would result from selling the lamps unfinished vs finishing them.
  Which option would be the most profitable (without considering other qualitative issues)?

Quizplus · Accepted Answer

The Answer of The Consumer Products division of Sweet Dreams has been struggling lately. Management has noticed a steady level of losses being reported, and is concerned about how to turn the division around. The division manager reports that the production of Lamps is causing the issue. As part of an in-depth analysis, management wants you to evaluate the following possible solution: Sell unfinished products.
Management is aware that Sweet Dreams has the capability to become a supplier of the internal wiring of lamps for other manufacturing companies, rather than sell the lamps as finished goods to wholesalers. The following information contrasts the costs and revenues that would result from selling the lamps unfinished vs finishing them.
  Which option would be the most profitable (without considering other qualitative issues)?

The Consumer Products Division of Sweet Dreams Has Been Struggling