Which of the following describes a transfer pricing system based on either variable costs or full-absorption costs,and applies a normal markup to costs as a surrogate for market prices when intermediate market prices are not available?
A)hybrid.
B)dual.
C)cost-plus.
D)mark-to-market.

Question

Quizplus · Accepted Answer

The transfer pricing system described in the question is cost-plus, where a markup is added to the cost of production to arrive at a transfer price. A hybrid system would combine multiple methods of transfer pricing, while a dual system refers to using different transfer prices for different purposes (such as tax vs. managerial decisions). Mark-to-market refers to valuing assets at their current market value.

Which of the Following Describes a Transfer Pricing System Based