When the Selling Division in an Internal Transfer Has Unsatisfied

question 195

Multiple Choice

When the selling division in an internal transfer has unsatisfied demand from outside customers for the product that is being transferred,what is the lowest acceptable transfer price as far as the selling division is concerned?

• A) Variable cost of producing a unit of product.
• B) The full absorption cost of producing a unit of product.
• C) The market price charged to outside customers,less any costs saved by transferring internally.
• D) The amount that the purchasing division would have to pay an outside seller to acquire a similar product for its use.

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Definitions:

Ethnic Group

A community or population made up of people who share a common cultural background or descent.

Genocide

The deliberate and systematic extermination of a national, racial, political, or cultural group.

Serial Killer

An individual who commits a series of murders over an extended period of time, usually following a characteristic, predictable behavior pattern.

Education

The systematic process of facilitating learning, or the acquisition of knowledge, skills, values, and habits.