A price charged for a component by the selling division to the buying division of the same company is called a(n)
A)transfer price.
B)economic value added.
C)market price.
D)cost-based price.
E)none of these.

Question

Quizplus · Accepted Answer

A transfer price is the price charged by one division of a company to another division for a product or service. It is an internal pricing mechanism and can be based on cost or market considerations.

A Price Charged for a Component by the Selling Division