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It is often claimed that a two-part transfer pricing system offers a number of advantages to organizations which use it.
Which of the following statements is NOT an advantage of using a two-part transfer pricing system?
Suggested Answer: D
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8 comments · newest first
CA
Caitlin
12 months ago
Option A sounds like a solid benefit for both divisions!
TW
Twanna
1 year ago
Wait, are we sure about that? Seems like a stretch.
CA
Caitlin
1 year ago
Totally agree, option D just covers fixed costs.
LA
Lamar
1 year ago
I think option D is not really an advantage.
BR
Brandon
1 year ago
A two-part system can help align divisional goals.
MA
Marguerita
1 year ago
Hmm, I'm a bit confused by the different entries and how they apply to the two clients. I'll need to work through this step-by-step to make sure I understand the correct outcome.
FR
Frankie
1 year ago
I'm a little confused by the terminology here. I'll need to review my notes on the AAIs and the different account types to make sure I select the correct answer.
RI
Rikki
1 year ago
I think the number could be closer to 20, especially with all the combinations of credit scores and income levels. Each category should affect the interest rates uniquely.