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15 3 02:56:42 Sako Company's Audio Division produces a speaker that is used by manufacturers of various audio products. Sales and cost data on the

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15 3 02:56:42 Sako Company's Audio Division produces a speaker that is used by manufacturers of various audio products. Sales and cost data on the speaker follow Selling price per unit on the Intermediate market $92 Variable costs per unit $ 74 Fixed costs per unit (based on capacity 98 Capacity in unita 25,000 Sako Company has a Hi-Fi Division that could use this speaker in one of its products. The Hi-Fi Division will need 5,000 speakers per year. It has received a quote of $89 per speaker from another manufacturer. Sako Company evaluates division managers on the basis of divisional profits Required: 1. Assume the Audio Division sells only 20,000 speakers per year to outside customers. a. From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the Hi-Fi Division? b. From the standpoint of the HI-FI Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division? c. What is the range of acceptable transfer prices (if any) between the two divisions of left free to negotiate without interference, would you expect the division managers to voluntarily agree to the transfer of 5,000 speakers from the Audio Division to the Hi-Fi Division? d. From the standpoint of the entire company, should the transfer take place? BOOK Hint erences 2. Assume the Audio Division is selling 22,500 speakers per year to outside customers, From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the Hi-Fi Division? b. From the standpoint of the Hi-Fi Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division? What is the range of acceptable transfer prices (if any) between the two divisions? I left free to negotiate without interference, would you expect the division managers to voluntarily agree to the transfer of 5,000 speakers from the Audio Division to the H-F Division? d. From the standpoint of the entire company, should the transfer take place? 3. Assume the Audio Division is selling 25,000 speakers per year to outside customers. a. From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the Hi-Fi Division? b. From the standpoint of the HI-FI Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division? What is the range of acceptable transfer prices (if anvi between the two divisions? if left free to negotiate without interference, would 3. Assume the audio Division is selling 25,000 speakers per year to outside customers 6. From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the H- Division? b. From the standpoint of the Hi-Fi Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division? c. What is the range of acceptable transfer prices of any between the two divisions? if left free to negotiate without interference would you expect the division managers to voluntarily agree to the transfer of 5,000 speakers from the Audio Division to the Hi-Fi Division? d. From the standpoint of the entire company, should the transfer take place? Complete this question by entering your answers in the tabs below. Reg IA and 18 Reg 1c Reg 2A and 20 Reg 10 Reg 3A and Reg 2c Reg 20 Req3C Re 3D Assume the Audio Division is selling 22,500 speakers per year to outside customers. a. From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the HI-F Division? b. From the standpoint of the Hi-F Division what is the highest acceptable transfer price for speakers acquired from the Audio Division? Show less a. Lowest acceptable transfer price b. Highest acceptable transfer price $ $ 74 743 01 Swapeamers from the Audio Vision to the HIVISION d. From the standpoint of the entire company should the transfer take place? Complete this question by entering your answers in the tabs below. Reg 1A and 16 Reg 10 Reg 10 Red 2A and 20 Reg 20 Reg 20 Reo and Resc R30 Assume the Audio Division is selling 25,000 speakers per year to outside customers. a. From the standpoint of the Audio Division, what is the lowest acceptable trasfer price for speakers sold to the in Division? b. From the standpoint of the Hi-Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division Shows 3 a. Lowest acceptable transfer price b. Highest acceptable transfer price 74 92

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