If transfer prices are to be based on cost, then the costs should be actual costs rather than standard costs.

Name: If transfer prices are to be based on cost, then the costs should be actual costs rather than standard costs.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Using standard costs for transfer pricing can provide consistency and predictability, allowing for better planning and performance evaluation, whereas actual costs can vary and may introduce unpredictability.

If Transfer Prices Are to Be Based on Cost, Then