Required information SB (Static) Truball Incorporated which manufactures sports [The following information applies to the questions displayed below] 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: Outside price for materials Division A's annual purchases Division B's variable costs per unit Division B's fixed costs, per year Division B's capacity utilization $150 10,000 $140 $1,250,000 Net benefit to the firm as a whole from buying outside 100% units Exercise 19-33 (Static) Transfer Pricing; Decision Making [LO 19-4] Required: 1-0. Assume that division B can sell 10,000 units outside the company for $215 per unit with variable marketing costs of $10. What will be the net benefit/cost to the firm as a whole if Division B sells outside? (Enter all the amounts as positive value.)
Required information SB (Static) Truball Incorporated which manufactures sports [The following information applies to the questions displayed below] 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: Outside price for materials Division A's annual purchases Division B's variable costs per unit Division B's fixed costs, per year Division B's capacity utilization $150 10,000 $140 $1,250,000 Net benefit to the firm as a whole from buying outside 100% units Exercise 19-33 (Static) Transfer Pricing; Decision Making [LO 19-4] Required: 1-0. Assume that division B can sell 10,000 units outside the company for $215 per unit with variable marketing costs of $10. What will be the net benefit/cost to the firm as a whole if Division B sells outside? (Enter all the amounts as positive value.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Required information
SB (Static) Truball Incorporated which manufactures sports....
[The following information applies to the questions displayed below]
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:
Outside price for materials
Division A's annual purchases
Division B's variable costs per unit
Division B's fixed costs, per year
Division It's capacity utilization
$150
10,000
$140
$1,250,000
Net benefit to the firm as a whole from buying outside
100%
units
Exercise 19-33 (Static) Transfer Pricing; Decision Making [LO 19-4]
Required:
1-0. Assume that division B can sell 10,000 units outside the company for $215 per unit with variable marketing costs of $10. What will
be the net benefit/cost to the firm as a whole if Division B sells outside? (Enter all the amounts as positive value.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ffa50d0ec-a15b-459d-9b3f-507562f25b4f%2F4e8daad6-3e43-4690-b060-4730b080c8b4%2F8vtwyur_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information
SB (Static) Truball Incorporated which manufactures sports....
[The following information applies to the questions displayed below]
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:
Outside price for materials
Division A's annual purchases
Division B's variable costs per unit
Division B's fixed costs, per year
Division It's capacity utilization
$150
10,000
$140
$1,250,000
Net benefit to the firm as a whole from buying outside
100%
units
Exercise 19-33 (Static) Transfer Pricing; Decision Making [LO 19-4]
Required:
1-0. Assume that division B can sell 10,000 units outside the company for $215 per unit with variable marketing costs of $10. What will
be the net benefit/cost to the firm as a whole if Division B sells outside? (Enter all the amounts as positive value.)
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