Use the following information for the next 2 questions.
The Machining Division has a capacity of 2,000 units. Its sales and cost data are:
-If the Assembly Division is currently buying from an outside supplier at $98 per unit, what will be the effect on overall company profits if internal sales take place at the optimum transfer price?
A) $7,000 increase
B) $7,300 increase
C) $300 increase
D) There is no effect

Question

Use the following information for the next 2 questions.
The Machining Division has a capacity of 2,000 units. Its sales and cost data are: 
-If the Assembly Division is currently buying from an outside supplier at $98 per unit, what will be the effect on overall company profits if internal sales take place at the optimum transfer price?
A) $7,000 increase 
B) $7,300 increase 
C) $300 increase 
D) There is no effect

Quizplus · Accepted Answer

The Answer of Use the following information for the next 2 questions.
The Machining Division has a capacity of 2,000 units. Its sales and cost data are: 
-If the Assembly Division is currently buying from an outside supplier at $98 per unit, what will be the effect on overall company profits if internal sales take place at the optimum transfer price?
A) $7,000 increase 
B) $7,300 increase 
C) $300 increase 
D) There is no effect

Use the Following Information for the Next 2 Questions