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A carpet manufacturer maintains a retail division consisting of stores stocking its brand and other brands, and a manufacturing division that makes carpets and pads. An outside market exists for carpet padding material in which all padding produced can be sold. The proper transfer price for padding transferred from the manufacturing division to the retail division is:
A. Variable manufacturing division production cost plus variable selling and administrative cost.
B. Variable manufacturing division production cost plus allocated fixed factory overhead.
C. The market price at which the retail division could purchase padding.
D. Variable manufacturing division production cost.
Answer: C
Explanation:
The three basic criteria that the transfer pricing system in a decentralized company should satisfy are to 1) provide information allowing central management to evaluate divisions with respect to total company profit and each division's contribution to profit, 2) stimulate each manager's efficiency without losing each division's autonomy, and 3) motivate each divisional manager to achieve his/her own profit goal in a manner contributing to the company's success. The market price should be used as the transfer price to avoid waste and maximize efficiency in a competitive economy an outside market in which all padding produced can be sold). This price also measures the product's profitability and the division managers' performance in a competitive environment.
NEW QUESTION: 2
Welcher der folgenden Indikatoren ist der BESTE Indikator dafür, dass eine Organisation das Risiko angemessen steuert?
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Which Timing over Packet Solution provides only accurate frequency synchronization, but does not provide
time/phase synchronization?
A. Synchronous Ethernet
B. turning over IP connection and transfer of clock BOF
C. Network Time Protocol
D. Precision Time Protocol
Answer: A
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A team has an application that detects new objects being uploaded into an Amazon S3 bucket. The uploads trigger a Lambda function to write object metadata into an Amazon DynamoDB table and RDS PostgreSQL database.
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C. Create a Lambda function for each Availability Zone the application is deployed in.
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Answer: B
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