Review the transfer-price methods listed below and choose the best transfer-price method ideal to managers when prices of products and services listed in trade association Web sites are competitive.
A)Market-based transfer prices.
B)Cost-based transfer prices.
C)Hybrid transfer prices.
D)Segment-based transfer prices.
E)Demographic-based transfer prices.

Question

Quizplus · Accepted Answer

Market-based transfer prices would be the best choice in this scenario as they are based on the prices of similar products and services in the market. This would ensure that the transfer price is competitive and in line with industry standards. Cost-based transfer prices may not be appropriate as they do not consider market conditions or competition. Hybrid, segment-based, and demographic-based transfer prices may be useful in certain situations, but do not specifically address the issue of competitive pricing.

Review the Transfer-Price Methods Listed Below and Choose the Best