All of the Following Are Correct Statements About the Market-Based

question 131

Multiple Choice

All of the following are correct statements about the market-based approach except that it

• A) assumes that the transfer price should be based on the most objective inputs possible.
• B) provides a fairer allocation of the company's contribution margin to each division.
• C) produces a higher company contribution margin than the cost-based approach.
• D) ensures that each division manager is properly motivated and rewarded.

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Definitions:

Ovary

In flowering plants, the enlarged, ovule-bearing portion of the carpel that develops into a fruit; female gonad in animals that produces an egg and female sex hormones.

Anther

Male structure of a flowering plant where pollen is produced; attached to the flower by the filament.

Filament

End-to-end chains of cells that form as cell division occurs in only one plane; in plants, the elongated stalk of a stamen.

Stamen

The male reproductive organ of a flower, typically consisting of a filament and an anther, which produces pollen.