Figure 12-4

question 141

Multiple Choice

Figure 12-4. Quinn Inc.has a number of divisions.One division,Style,makes zippers that are used in the manufacture of boots.Another division,LeatherStuff,makes boots that use the zippers and needs 90,000 zippers per year.Style incurs the following costs for one zipper:
Quinn has capacity to make 950,000 zippers per year,but due to a soft market,only plans to produce and sell 620,000 zippers next year.LeatherStuff currently buys zippers from an outside supplier for $3.50 each (the same price that Style receives) .
Refer to Figure 12-4.Assume that Style and LeatherStuff have agreed on a transfer price of $3.25.What is the total benefit for Quinn,Inc.?

• A)$22,500
• B)$292,500
• C)$163,000
• D)$169,000
• E)$190,800

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Definitions:

Escherichia Coli

A common bacterium found in the intestines of humans and animals, some strains of which can cause food poisoning.

Serious

Serious implies a state or condition of great importance, gravity, or criticalness that demands careful consideration or attention.

"The Drip"

A colloquial term often referring to gonorrhea, a sexually transmitted infection characterized by the discharge of pus from the genitals.

Gonorrhea

A sexually transmitted infection caused by the Neisseria gonorrhoeae bacterium, often resulting in genital, rectal, and throat infections.