Materials Used by Square Yard Products Inc

question 55

Multiple Choice

Materials used by Square Yard Products Inc. in producing Division 3's product are currently purchased from outside suppliers at a cost of $5 per unit. However, the same materials are available from Division 6. Division 6 has unused capacity and can produce the materials needed by Division 3 at a variable cost of $3 per unit. A transfer price of $3.20 per unit is established, and 40,000 units of material are transferred, with no reduction in Division 6's current sales. How much would Square Yard Products total income from operations increase?

• A) $32,000
• B) $112,000
• C) $80,000
• D) $150,000

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Definitions:

Sex

A biological classification based on reproductive organs and chromosomal configurations, typically categorized as male or female.

Gender

The range of characteristics pertaining to, and differentiating between, masculinity and femininity, including social roles, behaviors, and identities.

Racism

Prejudice, discrimination, or antagonism directed against someone of a different race based on the belief that one's own race is superior.

Theory Of Relative Deprivation

The hypothesis that individuals feel deprived and frustrated not due to an absolute lack of something but because they compare their situation unfavorably to others'.