Figure 12-3 Quinn Has Capacity to Make 950,000 Zippers Per Year, but \\
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question 8

Multiple Choice

Figure 12-3 $\begin{array}{ll}\text { Direct materials } & \$ 0.23 \\\text { Direct labor } & \$ 0.20 \\\text { Variable overhead } & \$ 0.95 \\\text { Fixed overhead } & \$ 1.32 \\\text { Total } & \$ 2.70\end{array}$ 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 are the total cost savings for LeatherStuff?

• A) $22,500
• B) $315,000
• C) $292,500
• D) $69,000
• E) $81,000

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Definitions:

Secondary Groups

Social groups characterized by impersonal, formal, and instrumental relationships, often focused on a specific goal or task.

Explicit Objectives

Clearly defined goals or purposes that an organization or individual aims to achieve.

Networks

Sets of nodes (which can be individuals, organizations, computers, etc.) connected by relationships or communication paths, facilitating the exchange of information or resources.

Norms

Socially accepted rules or standards of behavior expected of members within a group or society.