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 H.-FI Division that could use this speaker in one of its products. The Hl.Fi Division will need 5,000 speakers per year it has recelved a quete of $97 per speaket from another manufacturee Sako Company evaluates divislen manegers on the bosis 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 speskers sold to the Hefi Division? b. From the standpoint of the Hi.fi Division, what is the highest acceptable transfer price for speakers acquled from the Audio Division? c. What is the range of acceptable bansfer prices fof any\} between the two divisions? i left tree to negoeiate without interference, would you expect the divsion managers to voluntarly agree to the transfer of 5,000 speakers trom the Audio Division to the Hifi Division? d. Fram the standpoint of the entire company, should the transfer take place? 2. Assume the Audio Division is seling 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 Division? b. From the standpoint of the HL-Fi Division, what is the highest acceptable transfer price for speakers acquired from the Audio Divisian? c. What is the range of acceptable transfer prices (f any) botween the two divisions? if lef 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 HL. Fi Disision? d. From the standpoint of the entire compary, should the transfer take place? 2. 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 Division? b. From the standpoint of the Hl-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 (f 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-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. 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
