Why are transfer prices necessary

Reference no: EM13902952

1. ‘‘An action that is optimal for a division may not be optimal for the company as a whole.'' Explain.

2. Why are transfer prices necessary?

3. In what sense is the word price in the term transfer price a misnomer?

4. Refer to this chapter's Managerial Application ‘‘Just-in-Time Production in Japan and the Internal Revenue Service in the United States.'' Why did the Internal Revenue Service dispute the transfer prices? Did the IRS want the prices set higher or lower? Why?

Reference no: EM13902952

Questions Cloud

What is the outward force on the window : A Viewing window in an aquarium is 62 inches wide and 56 inches high. If the average pressure inside the water tank is 16psi. What is the outward force on the window.

What impact does modeling have in supply chain management : What impact does modeling have in supply chain management? Describe how an MRP system controls dependent demand inventory.

The plans and goals that affect the entire organization : In a traditionally structured organization, the plans and goals that affect the entire organization are made by _____________ Randy Root Beer brand, best known for high-end raspberry root beer, offers consumers unique products that customers value an..

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..

User Account

All Pages