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Which of the following transfer pricing models sets prices at actual cost less all fixed costs? a Variable cost b. Full cost c. Market price d. Negotiated price
transfer pricing model:- is the price of comodity or service b/w divisons for the same institute or b/w 2 department in the same institute
there are three models of transfer pricing :-
1- cost based :- it contain the industrial cost production
2 - negotiable price :- both branches or dept. agreed on a specific price
3- market peice:- pricing depend on the balace of the first duration
The aim from transfer pricing is to maximize the dept. or the branch profit take in consideration also maximizing the organization profit and that should be approved and declared in dependent and consolidated statements
If the variable costs are less than Rs 200 per unit but the transfer price is set equal to the market price of Rs 200, then the manager of Division A is indifferent as to whether materials are ... Cost-basedtransfer prices may be in different forms such as variable cost, actual full cost, full cost plus profit margin, standard full cost.
Please rephrase your question, not clear.
A
