All of the Following Are True of Cost-Based Transfer Prices

question 146

Multiple Choice

All of the following are true of cost-based transfer prices except:

• A) They generally promote optimal decision-making from the standpoint of the organization as a whole.
• B) They may be based either on actual costs or standard (i.e., budgeted) costs.
• C) Their use may not provide proper motivation for cost control on the part of the producing division.
• D) They may not provide proper guidance when opportunity costs exist.
• E) Generally speaking, such cost data are readily available.

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The practice of using less energy to decrease energy demand and lessen environmental impact.

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