Transfer prices and divisional profits

Related BrainMass Solutions

• Transfer prices

  Necessary to calculate divisional profits. 2. Tells whether manager's incentives are aligned with the incentives of the overall company and its owner. 3.

• When should firm use direct intervention for transfer prices

  406876 The use of direct intervention for transfer prices When would you advise a firm to use direct intervention to set transfer prices?

• The differences between divisional profits

  This solution provides a discussion on how divisional profits differ.

• Net income at various transfer prices

  Required: a) Determine the divisional and company net income if the transfer price is set at the market price. b) Determine the divisional and company net income if the transfer price is set at total cost.

• Transfer Pricing Situations

  The manager of the divisions are evaluated based on their divisional profits.

• Accounting for decision making and control

  And the TD manager should consider the effect of toner prices on copier sales. However, focusing only on their own profits causes each divisional manager to ignore the effect of their pricing decision on the other manager's cash flows.

• Redstone Transfer Prices

  91993 Redstone Transfer Prices 1. Explain why transfer prices based on total actual costs are not appropriate as the basis for divisional performance measurement. 2.

• Drawem Company's evaluation of Bildem Company performance

  And management can adjust prices at any time and divert profits into or away from this division into another division.

• Management accounting :MCQ

  a. return on investment b. transfer pricing c. the contribution approach d. residual income 3. Which of the following is NOT a common approach used to set transfer prices?

• social welfare implications of price discrimination

  Ans: Transfer pricing refers to the pricing of goods and services within a multi-divisional organization.