Deal of The Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions
Mail Us support@pass4success.com
Location US
Mob_nav_barsMENU

CIMAPRO19-P02-1 Exam - Topic 4 Question 45 Discussion

A group consists of two divisions, Alpha and Beta, both of which are profit centers. Alpha sells a product to the external market and also sells it as an intermediate product to Beta.Beta then processes further before selling the final product to the external market. The current group transfer pricing policy requires Alpha to charge Beta with the variable cost of production.Which of the following statements is valid?
A) A two-part tariff would provide a more effective basis for assessing divisional performance.
B) A dual pricing approach to transfer pricing would increase Beta's total profit and reduce Alpha's.
C) If Alpha has unfulfilled external demand then the transfer price should always be set at variable cost.
D) Transfer prices only affect the assessment of performance of investment centres, not of profit centres.

CIMAPRO19-P02-1 Exam - Topic 4 Question 45 Discussion

Actual exam question for CIMA's CIMAPRO19-P02-1 exam
Question #: 45
Topic #: 4
[All CIMAPRO19-P02-1 Questions]

A group consists of two divisions, Alpha and Beta, both of which are profit centers. Alpha sells a product to the external market and also sells it as an intermediate product to Beta.

Beta then processes further before selling the final product to the external market. The current group transfer pricing policy requires Alpha to charge Beta with the variable cost of production.

Which of the following statements is valid?

Show Suggested Answer Hide Answer
Suggested Answer: A

by Brandon at May 04, 2022, 08:50 AM

Limited Time Offer

25%

Off

Get Premium CIMAPRO19-P02-1 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

0/2000 characters
Submit Cancel
Maile
9 months ago
Beta's profit should definitely be considered in pricing decisions!
upvoted 0 times
...
Almeta
9 months ago
Wait, are transfer prices really only for investment centres?
upvoted 0 times
...
Antonio
9 months ago
Variable cost pricing seems fair if there's external demand.
upvoted 0 times
...
Shawn
9 months ago
I disagree, dual pricing could complicate things too much.
upvoted 0 times
...
Kirk
9 months ago
A two-part tariff sounds interesting for performance assessment.
upvoted 0 times
...
Carlton
10 months ago
Okay, let's see. The question is asking what the "Reviewable Items" total includes, and the options mention different combinations of parent emails, attachments, loose files, embedded items, and related discussion thread items. I'll need to weigh each option carefully.
upvoted 0 times
...
Annice
10 months ago
This one seems pretty straightforward. Audit trails would be the best option to assist with host-based intrusion detection.
upvoted 0 times
...
Jettie
10 months ago
I've got a good feeling about this one. The maximum distance for 10OBaseTX Ethernet is 100 meters, and 802.3at PoE can handle up to 100 meters as well, so I'm going to go with option B.
upvoted 0 times
...
Glenn
10 months ago
Okay, I think I've got this. Based on the question, the Cortex XDR Pro per Endpoint license is the one that provides the EDR data collection capabilities the customer needs.
upvoted 0 times
...

Save Cancel