Some Managers Prefer to Use Cost Rather Than Market Price

question 81

Multiple Choice

Some managers prefer to use cost rather than market price in controlling transfers between divisions.If cost is to be used,then it should be

• A)full cost.
• B)direct cost.
• C)variable cost.
• D)standard cost.
• E)absorption cost.

---

Definitions:

International Financial Reporting Standards

A set of accounting standards developed by the International Accounting Standards Board, used globally to prepare public company financial statements.

Profitability Ratios

A group of ratios that show the combined effects of liquidity, asset management, and debt on operations.

Liquidity

The ease with which an asset can be converted into cash without affecting its market price.

Asset Management

The process of overseeing and optimizing the performance of a set of assets in a way that aligns with the investor's objectives.