Materials used by the Instrument Division of Ziegler Inc. are currentlypurchased from outside suppliers at a cost of $1,350 per unit. However,the same materials are available from the Components Divison. TheComponents Division has unused capacity and can produce thematerials needed by the Instrument Division at a variable cost of $900per unit. a. If a transfer price of $1,000 per unit is established and 75,000units of materials are transferred, with no reduction in theComponents Division's current sales, how much would ZieglerInc.'s total operating income increase?b. How much would the Instrument Division's operating incomeincrease?c. How much would the components Division's operating incomeincrease?

Benitez Company currently outsources a relay switch that is a component in one of its products. The switches cost $40 each. The company is considering making the switches internally at the following projected annual production costs:       Unit-level material cost $ 8   Unit-level labor cost $ 7   Unit-level overhead $ 6   Batch-level set-up cost (4,000 units per batch) $ 30,000   Product-level supervisory salaries $ 40,000   Allocated facility-level costs $ 25,000       The company expects an annual need for 4,000 switches. If the company makes the product, it will have to utilize factory space currently being leased to another company for $2,000 a month. If the company decides to make the parts, total costs will be: Multiple Choice a.$18,000 more than if the switches are purchased. b.$43,000 more than if the switches are purchased. c.$22,000 less than if the switches are purchased. d.$25,000 less than if the switches are purchased.

Zycon has produced 10,000 units of partially finished Product A. These units cost $15,000 to produce, and they can be sold to another manufacturer for $20,000. Instead, Zycon can process the units further and produce finished Products X, Y, and Z. Processing further will cost an additional $22,000 and will yield total revenues of $35,000. Place an X in the appropriate column to identify whether the item is relevant or irrelevant to the sell or process further decision.

The materials used by the North Division of Horton Company are currently purchased from outside suppliers at $29 per unit. These same materials are produced by Horton’s South Division. The South Division can produce the materials needed by the North Division at a variable cost of $14 per unit. The division is currently producing 126,000 units and has capacity of 180,000 units. The two divisions have recently negotiated a transfer price of $20 per unit for 54,000 units. By how much will each division's income increase as a result of this transfer? South Division $ North Division $

Corey Corporation manufactures joint products W and X. During a recent period, joint costs amounted to $320,000 in the production of 25,000 gallons of W and 60,000 gallons of X. Both products will be processed beyond the split-off point, giving rise to the following data:   W X Separable processing costs $ 45,000 $ 150,000 Sales price (per gallon) if processed beyond split-off $ 15 $ 13 What would be the joint cost allocated to X under the net-realizable-value method ? Note: Do not round intermediate calculations.

The Eastern division sells goods internally to the Western division of the same company. The quoted external price in industry publications from a supplier near Eastern is $200 per ton plus transportation. It costs $20 per ton to transport the goods to Western. Eastern's actual market cost per ton to buy the direct materials to make the transferred product is $100. Actual per ton direct labor is $50. Other actual costs of storage and handling are $40. Assuming there is an excess capcity in the Eastern Division, the minimum and maximum transfer price are: