A Benefit of Using a Market-Based Transfer Price Is That

question 9

Multiple Choice

A benefit of using a market-based transfer price is that the ________.

• A) profits of the transferring division are sacrificed for the overall good of the corporation
• B) profits of the division receiving the products are sacrificed for the overall good of the corporation
• C) economic viability and profitability of each division can be evaluated individually
• D) transferring division can be assured of recovering its full costs in all scenarios

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Definitions:

Retirement

The stage of life where an individual stops employment completely, often to rely on savings or pension for financial support.

Persistent Breach

A continuous or repeated failure to uphold the terms of a contract or agreement.

General Partnership

A business structure where two or more individuals own and operate a business in common with shared profits, liabilities, and management duties.

Business Opportunity

A commercial idea or plan that has the potential for financial gain.