The negotiated transfer price approach should be used when
A) the selling division has available capacity and is willing to accept less than the market price.
B) an outside market for the goods does not exist.
C) no market price is available.
D) any of these situations exist.

Question

Quizplus · Accepted Answer

The negotiated transfer price approach should be used when any of the situations mentioned in options A, B, and C exist. In other words, if the selling division has available capacity and is willing to accept less than the market price or if an outside market for the goods does not exist, or if there is no market price available, then the negotiated transfer price approach can be used.

The Negotiated Transfer Price Approach Should Be Used When