A Major Advantage of Using Actual Costs for Transfer Prices

question 90

True/False

A major advantage of using actual costs for transfer prices is that often inefficiencies are NOT passed along to the receiving division.

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Definitions:

Chlorination

The addition of chlorine to water or organic compounds, either as a disinfectant or to introduce chlorine atoms into molecules during chemical synthesis.

Methane

A colorless, odorless gas, the simplest alkane and the main component of natural gas; used as a fuel and in organic synthesis.

Termination Reaction

The chemical reaction that concludes a chain reaction process by reacting two or more reactive intermediates to form a stable product.

Chlorination

A chemical process where chlorine is introduced to a compound, often to disinfect or to modify organic molecules in synthesis.