The Amount Charged When One Business Unit Sells Goods or Services

question 3

Multiple Choice

The amount charged when one business unit sells goods or services to another business unit is called:

• A) an opportunity cost.
• B) a transfer price.
• C) a standard variable cost.
• D) a residual price.

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Definitions:

Balance Sheets

Financial statements that show the assets, liabilities, and equity of a company at a specific point in time, providing a snapshot of its financial position.

Transactions

Economic events that affect the financial position of a company, involving the transfer of value between two or more entities.

Stockholder

An individual or entity that owns shares in a corporation, giving them ownership interest and possibly dividends.

Economic Activities

Actions that involve the production, distribution, and consumption of goods and services in an economy.