Why are full cost and cost plus a mark-up transfer prices unlikely to result in the optimum

Question:

Why are full cost and cost plus a mark-up transfer prices unlikely to result in the optimum output?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For answer-question

Management and Cost Accounting

ISBN: 978-1473748873

10th edition

Authors: Colin Drury

See More Books

Question Posted: Feb 10, 2020 10:20 AM

See More Questions

Multiple- Choice 1. The Sarbanes- Oxley Act of 2002 requires management to include a report on the effectiveness of ICFR in the entitys annual report. It also requires auditors to report on the...
To me, economic value is the only justifiable basis for measuring plant assets for purposes of evaluating performance. By economic value, I mean the present value of expected future services. Still,...
What are the three reasons that subliminal perception is unlikely to result in a purchase? Despite these findings, what role is neuroscience now playing in the creation of marketing messages?
Aneko Company reports the following ($000s): net sales of $14,800 for 2018 and $13,990 for 2017; end-of-year total assets of $19,100 for 2018 and $17,900 for 2017. Compute its total asset turnover...
An alternative to disclosing information about related parties is to restate related party events as though they had occurred between independent parties in arm's length transactions. Explain why...
Solve each proportion in Problems 1942 for the item represented by a letter. 5 1 A 6
1. Read the text materials on feedforward, concurrent, and feedback control. 2. Read the Control Problem Situation and be prepared to resolve those control problems in a group setting. 3. Your...
Russell Furniture manufactures computer desks in its Westlake, Ohio, plant. The company uses activity- based costing to allocate all manufacturing conversion costs (direct labor and manufacturing...
(a) Consider the recurrence below defined for n 0. 3 T(n): if n = 0 7T (n - 1) +12 if n > 0 Give a closed-form solution to the recurrence. You only have to give the solution. You do not need to show...
Janet, Karen, and Lisa are equal general partners in JKL Partnership. In Year 1 the partnership made liquidating distributions to each of the partners. Information about the assets distributed and...
If there is no external market for the intermediate product what is the optimal transfer price? Why?
Why are marginal cost transfer prices not widely used in practice?
Rewrite the word statement or phrase in Problems 310, using symbols. Translate and then simplify. a. The quotient of three divided by the sum of two and four b. Ten times the sum of four and three
What is the present value of the receipt of $14,000 per year for 12 years if the investors required return is 11%?
A firm has a market value of equity of $30,000 . It borrows $7500 at a cost of 8%. If the firms assets have a cost of capital of 15%, what is the firm's cost of equity capital? Assume no taxes.
What are some benefits of improved sustainability of a supply chain?
A local magazine is offering a $2,500 grand prize to one lucky winner. The prize will be paid in four annual payments of $625 each, starting one year after the drawing. How much would this prize be...
Your company's stock carries a $1.06 that hasn't changed in many years. Board members are convinced that the typical shareholder aims for a required return (or has an opportunity cost) of 7.45%. What...
Manitoba Deck System Corporation (MDSC) is a public company whose shares are actively traded on the Toronto Stock Exchange. The following transactions occurred in 2017: Jan. 1 The company was granted...
Which of the following gives the range of y = 4 - 2 -x ? (A) (- , ) (B) (- , 4) (C) [- 4, ) (D) (- , 4] (E) All reals
Discuss how the micro-macro dilemma relates to each of the following products: high-powered engines in cars, nuclear power, bank credit cards, and pesticides that improve farm production.
s problem introduces you to the computer-aided prob lem (CAP) softwarewhich is at the O n line Learning Center for this textand gets you started with the use of spreadsheet analysis for marketing...
Distinguish clearly between a marketing strategy and a marketing mix. Use an e x ample.
8 (a) Find a function that represents the power series 3 (k + 1) x *. As always, show all work. [Hint: Split it.] k=0 (b) Use your answer from (a) to find the sum of the series answer as a reduced...
The function f(x)=2x^(4)+x^(3)-7x^(2)+4 has at least two rational roots. Use the rational root theorem to find those roots, then proceed to find all complex roots. (Note: roots may be integer,...
Wildcat Company is considering a 5-for-3 stock split. The current price is $57.00 per share, and Wildcat believes that its total market value would increase by 7.5% as a result of the improved...

Why are full cost and cost plus a mark-up transfer prices unlikely to result in the optimum

Question:

Step by Step Answer:

Disadvantages of Full Cost Plus Pricing Ignores compet...View the full answer

Management and Cost Accounting

Students also viewed these Business questions