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: Sako Company has a Hi-F Division that could use this speaker in one of its products. The Hifi Division will need 5,000 speakers per year. It has recelved a quote of $65 per speaker from another manufacturer. Sako Company evaluates division manogers 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 standpolnt of the Audio Division, what is the lowest acceptable transfer price for speokers sold to the Hifi-i Division? b. From the stancpoint of the HIFFi Division, what is the highest acceptable transfer price for speokers acquired from the Audlo Division? c. What is the range of acceptable transfer prices (f any) between the two divisions? if teft free to negotiate without interference, would You expect the division managers to voluntanily agree to the transfer of 5,000 speakers from the Audio Division to the Hil-Fi Division? d. From the standpoint of the entire company, should the transter take piace? 2. Assume the Audio Division is selling 22,500 speakers per year to outside customer5. 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? 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? 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? c. What is the range of acceptable transfer prices (if 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-FIDivision? d. From the standpoint of the entire company, should the transfer take place? Complete this question by entering your answers in the tabs below. 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 occeptable transfer price for speakers sold to the Hl-Fi Division? b. From the standpoint of the Hi-A Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division? Complete this question by entering your answers in the tabs below. What is the range of acceptable transfer prices (if 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? Assume the Audio Division is now selling only 20,000 speakers per year to outside customers. Complete this question by entering your answers in the tabs below. From the standpoint of the entire company, should the transfer take place? Assume the Audio Division is now selling only 20,000 speakers per year to outside customers. 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-Fi Diviston? 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 aryy) 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? Assume the Audio Division is sefing 22,500 speakers per year to outside customers. From the standpoint of the entire company, should the transfer take place? Assume the Audio Division is selling 22, 500 speakers per year to outside customers. 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 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? From the sinpoint of the entire company, should the transfer take place? Assume the Audio Division is selling 25,000 speakers per year to outside customers
