________ pricing uses two separate transfer-pricing methods to price each transfer from one subunit to another.
A)Dual
B)Prorated
C)Minimum
D)Maximum
E)Negotiated

Question

Quizplus · Accepted Answer

Dual pricing uses two transfer-pricing methods, one for the selling subunit and another for the buying subunit. This ensures that each subunit has an incentive to optimize its own profits while taking into consideration the costs and benefits of the other subunits. Dual pricing also provides a reasonable and fair allocation of costs and profits across the subunits. Therefore, dual pricing is the best choice for pricing transfers between subunits.

________ Pricing Uses Two Separate Transfer-Pricing Methods to Price Each