SOLVE 1C AND 1D PART PLEASE FAST DO IT THANK YOU

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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SOLVE 1C AND 1D PART PLEASE FAST DO IT THANK YOU

c. What is the range of acceptable transfer prices (if any) between the two divisions? If left free to negotiate without interference, v
you expect the division managers to voluntarily agree to the transfer of 5,000 speakers from the Audio Division to the Hi-Fi Divisi
d. From the standpoint of the entire company, should the transfer take place?
Complete this question by entering your answers in the tabs below.
Req 1A and
1B
Rec 1C
Req 1A and
1B
Req 1D
Range of acceptable transfer prices
Are the managers likely to agree on a transfer price?
Req 1C
Req 2A and
2B
Req 1D
Should the transfer take place?
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.
Req 2C
<
Req 2A and
2B
Req 1A and 1B
Req 2C
<
Req 2D
Req 1C
Req 3A and
3B
Req 2D
Req 1D
ncy un
3B
Req 3C
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.
Req 2A and 2B
>
Req 3D
Req 30
KEY JL
Show less
Transcribed Image Text:c. What is the range of acceptable transfer prices (if any) between the two divisions? If left free to negotiate without interference, v you expect the division managers to voluntarily agree to the transfer of 5,000 speakers from the Audio Division to the Hi-Fi Divisi d. From the standpoint of the entire company, should the transfer take place? Complete this question by entering your answers in the tabs below. Req 1A and 1B Rec 1C Req 1A and 1B Req 1D Range of acceptable transfer prices Are the managers likely to agree on a transfer price? Req 1C Req 2A and 2B Req 1D Should the transfer take place? 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. Req 2C < Req 2A and 2B Req 1A and 1B Req 2C < Req 2D Req 1C Req 3A and 3B Req 2D Req 1D ncy un 3B Req 3C 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. Req 2A and 2B > Req 3D Req 30 KEY JL Show less
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
$128
$ 110
$8
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 $125 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? 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?
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 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-Fi Division?
d From the standpoint of the entire company should the transfer take place?
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Transcribed Image Text: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 $128 $ 110 $8 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 $125 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? 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? 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 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-Fi Division? d From the standpoint of the entire company should the transfer take place? Prev 1 of 2 www www E Next >
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