Division R of Harris Corporation Has the Capacity for Making

question 101

Multiple Choice

Division R of Harris Corporation has the capacity for making 40,000 wheel sets per year and regularly sells 36,000 each year on the outside market. The regular selling price on the outside market is $89 per wheel set, and the variable production cost per unit is $56. Division S of Harris Corporation currently buys 6,000 wheel sets (of the kind made by Division R) yearly from an outside supplier at a price of $85 per wheel set. If Division S were to buy the 6,000 wheel sets it needs annually from Division R at $83 per wheel set, the change in annual net operating income for the company as a whole, compared to what it is currently, would be:

• A) $108,000
• B) $174,000
• C) $162,000
• D) $96,000

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Definitions:

Irrigate

The process of supplying water to land or crops to help growth, typically by means of channels.

Pharmacy

A discipline and place where medicines are compounded or dispensed; also a field concerning the science and practice of preparing, preserving, compounding, and dispensing medications.

Nutritional Needs

The essential nutrients required by the body for growth, repair, and proper function.

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A professional session with a registered dietitian to assess nutritional needs and plan dietary interventions.