What factors companies consider when setting transfer prices

Assignment Help Financial Accounting

Reference no: EM13902949

1. What factors should companies consider when setting transfer prices for products sold from a division in one country to a division in another country?

2. Division A has no external markets. It produces a product that Division B uses. Division B cannot purchase this product from any other source. What transfer pricing system would you recommend for the interdivisional sale of the product? Why?

Reference no: EM13902949

Questions Cloud

Discuss the working capital management strategies : What do you mean by horizontal and vertical analysis of financial statements? Discuss the categories of Ratios with the help of suitable example. Explain the concept of working capital. Discuss the working capital management strategies. Elaborate Rev..

Why are transfer prices necessary : ‘‘An action that is optimal for a division may not be optimal for the company as a whole.'' Explain. Why are transfer prices necessary? In what sense is the word price in the term transfer price a misnomer?

Determine the initial acceleration a of the vehicle : The vehicle is released from rest with a restraining force T of 500 N n the control cable which passes around the drum and is secured at D. The wheels roll without slipping. Calculate the inertia of wheel A about its centre in kg.m^2

Trade-off between internal validity and external validity : In the context of experimental design in research, what is your understanding of “trade-off between internal validity and external validity? Explain how the selection of participants in a research experiment my affect both the internal and external v..

What factors companies consider when setting transfer prices : What factors should companies consider when setting transfer prices for products sold from a division in one country to a division in another country?

Reactions to perceived inequity according to equity theory : What is motivation? Describe 3 theories of motivation, compare and contrast them. Explain how you would apply each of these theories to motivate your professors. If an OB instructor has similar credentials to a marketing instructor (both of them teac..

What allows him entrance into heaven : Discuss the concept of atonement in Islam versus Christian Theism. How does man find forgiveness, and what allows him entrance into heaven?

Describe the economic basis for transfer pricing systems : Describe the economic basis for transfer pricing systems. ‘‘The return on investment measure may be biased in favor of divisions with older plant and equipment.'' Explain.

User Account

All Pages