(Appendix 11A) Stokan Products, Inc

question 30

Multiple Choice

(Appendix 11A) Stokan Products, Inc., has a Antennae Division that manufactures and sells a number of products, including a standard antennae that could be used by another division in the company, the Aircraft Products Division, in one of its products. Data concerning that antennae appear below:
The Aircraft Products Division is currently purchasing 5,000 of these antennaes per year from an overseas supplier at a cost of $57 per antennae.
-What is the maximum price that the Aircraft Products Division should be willing to pay for antennaes transferred from the Antennae Division?

• A) $22 per unit
• B) $57 per unit
• C) $18 per unit
• D) $40 per unit

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Definitions:

Inventory

The total amount of goods and materials held in stock by a business, warehouse, or other entity.

Sharing Economy

An economic system in which assets or services are shared between private individuals, either free or for a fee, typically by means of the Internet.

Peer-To-Peer

A communications model that is decentralized, where every participant has equal capabilities, and both parties can start a communication session.

Rent

Payment made periodically by a lessee to a lessor for the use of premises or other property.