The selling division would never agree to a transfer price below its full manufacturing cost.

Name: The selling division would never agree to a transfer price below its full manufacturing cost.
Brand: Quizplus
Rating: 4.8 (42 reviews)

Question

Quizplus · Accepted Answer

The selling division might agree to a transfer price below its full manufacturing cost if the transfer allows the division to utilize spare capacity, contribute to covering fixed costs, or if the internal transfer does not affect its ability to sell products at a higher price in the external market.

The Selling Division Would Never Agree to a Transfer Price