? Answer In segment reporting, transfer pricing betweensegments should be based ona)Cost onlyb)Market price only?c) The same basis used to actually priceintersegment transfersd)Standard cost only

Explanation of Segment Reporting: Segment reporting involves presenting financial information…

Answered: In segment reporting, transfer pricing…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter10: Evaluating Decentralized Operations

Section: Chapter Questions

Problem 9DQ

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Similar questions

Determining the transfer price as the price at which the product or service transferred could be sold to outside buyers is known as the Oa. cost price approach Ob. negotiated price approach Oc. market price approach Od. revenue price approach
This transfer prices basis is considered to be the most inferior one a. variable cost transfer pice b. full cost transfer price c. negotiatied transfer price d. external market transfer price e. dual transfer price
What are considered direct costs in segment analysis?
A transfer pricing structure that considers the opportunity costs of selling to internal rather than external customers uses_______. A. the cost approach B. the general transfer pricing approach C. the market-based approach D. the opportunity cost approach
Discuss the advantages and disadvantages of a market-based transfer pricing approach.
Which of the following is one of the two approaches used to analyze data in the decision to keep or discontinue a segment? A. comparing contribution margins and fixed costs B. comparing contribution margins and variable costs C. comparing gross margin and variable costs D. comparing total contribution margin under each alternative
Select Among the choices, this transfer prices basis is considered as the most inferior one: a. variable cost transfer pice b. full cost transfer price c. negotiatied transfer price d. external market transfer price e. dual transfer price
Explain the difference between market-based transfer prices and cost-based transfer prices.
In a transfer pricing decision, which of the following factors should be considered? Both A and B None of the above Market price and cost Negotiation and target profit
2. Transfer prices can be based on any of the following methods except a)variable cost b)replacement cost c)negotiated price between selling and buying divisions d)external market price e)variable and fixed costs
Which of the following transfer price approaches is used when the transfer price is set at the amount sold to outside buyers? a. variable price b. cost price c. negotiated price d. market price
1 (b) (i) Explain the criteria used for judging a transfer pricing system (ii) Explain the term “ negotiated versus imposed transfer prices “ (iii) Explain two methods of transfer pricing.

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In segment reporting, transfer pricing between segments should be based on a)Cost only b)Market price only ? c) The same basis used to actually price intersegment transfers d)Standard cost only