r 11 Homework × ezto.mheducation.com/hm.tpx Sako Company\'s Audio Division produ
ID: 2559984 • Letter: R
Question
r 11 Homework × ezto.mheducation.com/hm.tpx 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 $45 S20 $6 57,000 market costs per unit Fixed costs per unit (based on capacity) Capacity in units vision will Sako Company has a Hi-Fi Division that could use this speaker in one of its products. The Hi-Fi D need 10,000 speakers per year. It has received a quote Sako Company of $31 per speaker from another manufacturer evaluates division managers on the basis of divisional profits. Required: 1. Assume that the Audio Division is now selling onl 47,000 speakers per year to outside customers a. From the standpoint of the Audio Division, what is the lowest acceptable transter price for speakers sold to the Hi-Fi Division?Explanation / Answer
a) Where the variable cost per unit is $20, the lowest acceptable quotation price is $20.
b) $45 where the selling price of speaker is $45.
c) yes because is gives a contribution of $11 per unit.
d) Transfer should be take place
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