Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Q. What is Minimum pricing?
The minimum transfer price an internal seller would accept will depend on whether it has spare capacity to utilise or not.
If spare capacity exists the relevant cost and therefore minimum price to a seller would be the variable (marginal) cost of production e.g. extra cost of making and selling one more unit. Variable (marginal) cost would be the only cost considered by a seller because fixed overhead is normally unavoidable and would not change if supply did or did not take place. The variable (marginal) cost represents the absolute bare minimum transfer price to a seller, in circumstances of spare capacity, at this price, the seller would be indifferent but not out of pocket. Marginal costing may also be appropriate when no intermediate market exists for the seller e.g. Seller can only sell to an internal customer and no external customers are available.
If full capacity exists, the seller would have to turn away external customers and business will be lost if further internal supply were to take place. Because of this dilemma the seller would normally want a minimum price at least equal to the external market price it would normally charge when selling to external customers, this is assuming there is no difference in the cost of supplying internal or external customers e.g. differences in packaging, delivery or marketing costs, in which case the price would normally be adjusted.
The minimum transfer price for a seller at full capacity is generally the external market price, if for some reason the seller maybe discontinuing other products to supply internally, then the minimum price would be the variable (marginal) cost of production and the lost contribution from discontinuing other products for internal supply to take place e.g. the variable cost and contribution lost being the opportunity cost.
i need some template on the above statement
Recognizing a Company's Strategy 1. A company's strategy is reproduced in its actions in the marketplace & the statements of senior managers regarding the company's current b
Question 1: Read the article in the assigned Reading, “Management: A Journey in Progress.” Which do you think are the most enduring management principles and management responsibil
Question 1: (i) Why should stategic issues involve all stakeholders for a product or/and service? (ii) What are the objectives of strategic formulation and implementation
Question 1: Elaborate on the following business strategies giving examples, and discuss under what circumstances these business strategies are applied. a) Forward integrati
Q. Process to implement balanced scorecard? 1. A clear vision of introduction of a BSC communicated and demonstration which senior management are committed to the idea. 2. E
Threat: Arpanaa has very few competitors who are sprouting slowly and hence it is very important to keep the services updated based on the latest technology according to the needs
Process design strategy define with example
Q. Benefits of shared service centres ? ¸ Economies of scale e.g. sharing overhead of a centralised function or process across divisions in the same group, it avoids divisions
Mergers and acquisitions (abbreviated M&A) are both an aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of di
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd