Which of the Following Is True About the Negotiated Transfer

question 28

Multiple Choice

Which of the following is true about the negotiated transfer pricing approach?

• A)A minimum transfer price is established by the buying division.
• B)A negotiated transfer price should be used when an outside market for the goods does not exist.
• C)A maximum transfer price is established by the selling division.
• D)It is used more often than the cost-based and market-based approaches.

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Definitions:

Moral Equality

The principle that all individuals are equal in moral worth and should be treated as such.

Equality Of Opportunity

The principle that all individuals should have the same chances to pursue their goals without unfair barriers.

Intuitionism

A philosophical doctrine positing that basic moral truths are known instinctively or intuitively, beyond empirical observation or logical deduction.

Corporate Governance

The framework of rules, practices, and processes by which a corporation is directed and controlled.