Answer the Following Questions Using the Information Below

question 85

Multiple Choice

Answer the following questions using the information below:
Calculate the Division operating income for the AlphaShoe Company which manufactures only one type of shoe and has two divisions, the Sole Division, and the Assembly Division. The Sole Division manufactures soles for the Assembly Division, which completes the shoe and sells it to retailers. The Sole Division "sells" soles to the Assembly Division. The market price for the Assembly Division to purchase a pair of soles is $40. (Ignore changes in inventory.) The fixed costs for the Sole Division are assumed to be the same over the range of 40,000-100,000 units. The fixed costs for the Assembly Division are assumed to be $14 per pair at 100,000 units.

-Calculate and compare the difference in overall corporate net income between Scenario A and Scenario B if the Assembly Division sells 100,000 pairs of shoes for $120 per pair to customers.

• A)$1,000,000 more net income under Scenario A
• B)$1,000,000 of net income using Scenario B
• C)$200,000 of net income using Scenario A.
• D)None of these answers is correct.

Understand the impact of currency value changes on exchange rates.

Apply mathematical knowledge to make informed decisions in financial transactions involving fees and charges.

Solve complex problems involving multiple steps and calculations to find exact numerical answers.

Understand the rights and responsibilities of corporate directors and officers.

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Definitions:

Behavior Modification

A technique used to change behavior through the systematic application of the principles of conditioning.

Reinforce Behavior

The process of encouraging a specific behavior to occur more frequently by applying positive or negative stimuli following the behavior.

Feedback on Behavior

Information or observations provided regarding an individual’s actions or conduct, aimed at promoting understanding or improvement.

Johari Window

A model that helps people better understand their relationship with self and others, representing information through four quadrants of known and unknown aspects.