Which of the following information should be taken into account when using a negotiated transfer price method to determine transfer price?
i. External market price
ii. Savings in selling and distribution costs when transferring internally
iii. Excess capacity in the selling division
iv. Excess capacity in the buying division
A) ii and iii
B) i, ii and iii
C) ii, iii and iv
D) i, ii, iii and iv

Question

Quizplus · Accepted Answer

When using a negotiated transfer price method, it's important to consider the external market price, savings in selling and distribution costs, and excess capacity in the selling division to ensure the price reflects market conditions and internal efficiencies.

Which of the Following Information Should Be Taken into Account