wipe 4 https//www.facebo... http://instagram.co. sumuobe (3 se m ary Login Bar Barry University Go Grammarly Free W Alpha and Beta are divisions within the same company. The managers of both divisions are evaluated based on their own division's return on investment (ROI). Assume the following information relative to the two divisions Alpha Division Capacity in units Number of units now being sold to outside customers Selling price per unit to outside 55,000 55,000 284,000 284,000 110,000 84.000 202,000 202.000 $ $ 100 $ 62 S 39 $ 19 S 63 $ 38 S 31 24 $ 6 $ 22 $ 5 Variable costs per unit Flored costs per unit (based on capacity) Beta Division Number of units needed annually Purchase price now being paid to an outside supplier "Before any purchase discount 22.000 66.000 10,900 69,000 915 36 $ Managers are free to decide if they will participate in any internal transfers. All transfer prices are negotiated Required: 1. Refer to case 1 shown above Alpha Division can avoid $5 per unit in commissions on any sales to Beta Division a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices (if any) between the two divisions? Will the managers probably agree to a transfer? 2. Refer to case 2 shown above. A study indicates that Alpha Division can avoid 55 per unit in shipping costs on any sales to Beta Division a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices of any between the two divisions? Would you expect any disagreement between the two divisional managers over what the exact transfer price should be? d. Assume Alpha Division offers to sell 69,000 units to Bela Dision for $35 per unit and that Beta Division refuses this price What will be the loss in potential profits for the company as a whole? 3. Refer to case 3 shown above. Assume that Beta Division is now receiving in 5% price discount from the outside supplier a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Dision? c. What is the range of acceptable transfer prices of any between the two divisions? Will the managers probably agree to a transfer bere any purchase discount Managers are free to decide if they will participate in any internal transfers. All transfer prices are negotiated Required: 1. Refer to case 1 shown above Alpha Division can avod 55 per unit in commissions on any sales to Beta Division a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices of any between the two divisions? Wat the managers probably agree to a traster? 2 Refer to case 2 shown above A study indicates that Alpha Division can avoid $5 per unit in shipping costs on any sales to Beta Division a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices (if any) between the two divisions? Would you expect any disagreement between the two divisional managers over what the exact transfer price should be? d. Assume Alpha Division offers to sell 69.000 units to Beta Division for $35 per unit and that Beta Dision refuses this price What will be the loss in potential profits for the company as a whole 3. Refer to case 3 shown above Assume that Bela Division is now recewing an 5% price discount from the outside supper a What is the lowest acceptable transfer price from the perspective of the Alpha Dision? What is the highest acceptable transfer price from the perspective of the Beta Divisin? What is the range of acceptable transfer prices any between the two divisions? Wwthe managers probably agree to transfer d. Assume Beta Division offers to purchase 22 000 units from Alpha Division at $54 85 per unit of Apha Division accept this price would you expects ROI increase decrease or remain unchanged? A Refer to case & shown above Assume that Beta Division wants Alpha Ovision to provide it with 66.000 units of alterent product from the one Alpha Ovason is producing now The new product would require 527 per unit in variable costs and would require that Apa Division cut back production of is present product by 33000 unts What is the lowest accepterer c om Alpha Division's perspective? Complete this question by entering your answers in the tabs below. wipe 4 https//www.facebo... http://instagram.co. sumuobe (3 se m ary Login Bar Barry University Go Grammarly Free W Alpha and Beta are divisions within the same company. The managers of both divisions are evaluated based on their own division's return on investment (ROI). Assume the following information relative to the two divisions Alpha Division Capacity in units Number of units now being sold to outside customers Selling price per unit to outside 55,000 55,000 284,000 284,000 110,000 84.000 202,000 202.000 $ $ 100 $ 62 S 39 $ 19 S 63 $ 38 S 31 24 $ 6 $ 22 $ 5 Variable costs per unit Flored costs per unit (based on capacity) Beta Division Number of units needed annually Purchase price now being paid to an outside supplier "Before any purchase discount 22.000 66.000 10,900 69,000 915 36 $ Managers are free to decide if they will participate in any internal transfers. All transfer prices are negotiated Required: 1. Refer to case 1 shown above Alpha Division can avoid $5 per unit in commissions on any sales to Beta Division a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices (if any) between the two divisions? Will the managers probably agree to a transfer? 2. Refer to case 2 shown above. A study indicates that Alpha Division can avoid 55 per unit in shipping costs on any sales to Beta Division a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices of any between the two divisions? Would you expect any disagreement between the two divisional managers over what the exact transfer price should be? d. Assume Alpha Division offers to sell 69,000 units to Bela Dision for $35 per unit and that Beta Division refuses this price What will be the loss in potential profits for the company as a whole? 3. Refer to case 3 shown above. Assume that Beta Division is now receiving in 5% price discount from the outside supplier a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Dision? c. What is the range of acceptable transfer prices of any between the two divisions? Will the managers probably agree to a transfer bere any purchase discount Managers are free to decide if they will participate in any internal transfers. All transfer prices are negotiated Required: 1. Refer to case 1 shown above Alpha Division can avod 55 per unit in commissions on any sales to Beta Division a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices of any between the two divisions? Wat the managers probably agree to a traster? 2 Refer to case 2 shown above A study indicates that Alpha Division can avoid $5 per unit in shipping costs on any sales to Beta Division a What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices (if any) between the two divisions? Would you expect any disagreement between the two divisional managers over what the exact transfer price should be? d. Assume Alpha Division offers to sell 69.000 units to Beta Division for $35 per unit and that Beta Dision refuses this price What will be the loss in potential profits for the company as a whole 3. Refer to case 3 shown above Assume that Bela Division is now recewing an 5% price discount from the outside supper a What is the lowest acceptable transfer price from the perspective of the Alpha Dision? What is the highest acceptable transfer price from the perspective of the Beta Divisin? What is the range of acceptable transfer prices any between the two divisions? Wwthe managers probably agree to transfer d. Assume Beta Division offers to purchase 22 000 units from Alpha Division at $54 85 per unit of Apha Division accept this price would you expects ROI increase decrease or remain unchanged? A Refer to case & shown above Assume that Beta Division wants Alpha Ovision to provide it with 66.000 units of alterent product from the one Alpha Ovason is producing now The new product would require 527 per unit in variable costs and would require that Apa Division cut back production of is present product by 33000 unts What is the lowest accepterer c om Alpha Division's perspective? 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