24 To encourage division managers to act in ways consistent with organizational goals, divisional planning and control systems attempt to create a profit maximization b goal congruence c centralization d non goal congruent behavior Which of the following is managements challenge when setting transfer prices a Ensuring the buyer has goal congruence with respect to the organizations goals b Ensuring the seller has goal congruence with respect to the organizations goals c Ensuring either the buyer or the seller, but not both, has goal congruence with respect to the organizations goals d Ensuring both the buyer and seller have goal congruence with respect to the organizations goals Which of the following transfer pricing procedures maximizes the companys profit by transferring at the differential outlay cost to the selling division plus the opportunity cost to the company of making the internal transfers a effective transfer pricing rule b economic transfer pricing rule c efficient transfer pricing rule d None of the answers is correct What is generally considered the best transfer pricing basis when there is a competitive market for the product and market prices are readily available a Market price based transfer pricing b Variable cost based transfer pricing c Fixed price based transfer pricing d Fixed cost based transfer pricing

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Question: 24. To encourage division managers to act in ways consistent with organizational goals, divisional planning and control systems attempt to create a. profit maximization. b.

24. To encourage division managers to act in ways consistent with organizational goals, divisional planning and control systems attempt to create

a. profit maximization.

b. goal congruence.

c. centralization.

d. non-goal-congruent behavior.

a.	Ensuring the buyer has goal congruence with respect to the organizations goals.
b.	Ensuring the seller has goal congruence with respect to the organizations goals.
c.	Ensuring either the buyer or the seller, but not both, has goal congruence with respect to the organizations goals.
d.	Ensuring both the buyer and seller have goal congruence with respect to the organizations goals.

Which of the following transfer pricing procedures maximizes the companys profit by transferring at the differential outlay cost to the selling division plus the opportunity cost to the company of making the internal transfers?

a.	effective transfer pricing rule.
b.	economic transfer pricing rule.
c.	efficient transfer pricing rule.
d.	None of the answers is correct.

What is generally considered the best transfer pricing basis when there is a competitive market for the product and market prices are readily available?

a.	Market price-based transfer pricing
b.	Variable cost-based transfer pricing
c.	Fixed price-based transfer pricing
d.	Fixed cost-based transfer pricing

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