Janice Is in Charge of the Staining Department of a Local

Essay

Janice is in charge of the Staining department of a local woodworking business. She is ramping up for what is likely to be her busiest year so far. She anticipates that the department will need 18,000 oak planks to meet their order fulfillment. The internal Materials department would be able to fulfill half of this order before it meets its capacity and has reported the following information about their external sales: The Materials department has agreed to a negotiated sales price of the minimum acceptable transfer price. An external vendor has also said it could fulfill the other half for $2.15 per plank, or they would agree to $2.10 if Janice bought all 18,000 planks from them. What is the difference in overall price if Janice purchases half internally and half externally versus purchasing all planks externally? Do not round intermediate calculations.