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 Variable costs per unit Fixed costs per unit (based on capacity) Capacity in units $ 112 $ 94 5 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 S109 per speaker from another manufacturetSako Company evaluates division managers on the basis of divisional profits Required: 1. Assume the Ancio Division selis only 20,000 speaker year to outside customers. a. From the standent of the Audio Division, what clot acceptable transfer prispeers sold to the Hi-Fi Division? b. From standpa of the Hi-Fi Division, who the high acceptable transfer ce for speaker acquired from the Audio Division c. What the range of deptable transferees (if any) betwee the two division left free to negotid would you explet the division meegers to voluy agree to the trans of 5.000 ppakers from the Audio Division to the Hi-Fi Division? d. From de standpoint of the entire company, should the transfer tal lace? 2. Assume Audio Division is selling 22 Epeakers per year to outside cu a. From thy stol point of the Audio Don was the lowest acceptablesfer for speakers sold to the HI-FI Don? b. Frome standint of the Hi-Fi Sion what the highest acceptransfer price speakers acquired from Audio Division c. What the range of transfer prices (if an en the two divisions? If left free to without interference, would you expt 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 spenkers 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? 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? c. 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 1B Reg 1 Reg 10 Red 2A and 28 Reg 20 Reg 20 Reg BA and Reg 30 Reg 3D Assume the Audio Division is selling 25,000 species per year to outside customers From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the Division b. From the standpoint of the Division, what is the highest scortatile transfer price for speakers acquired from the Audio Division? Show less Lowest acceptable transfer price ghel aceptable transfer price h
