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Aro-Products has six divisions. Division 6 has unused capacity and can produce parts which are...

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Accounting

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Aro-Products has six divisions. Division 6 has unused capacity and can produce parts which are used by Division 3. The variable cost to produce the parts is $3 per unit. Division 3 currently purchases the parts from an outside supplier for $5 per unit. A transfer price of $3.20 is established and 40,000 units of material are transferred How much would Division 3's income from operations increase? $150.000 $50,000 $32,000 $72.000

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