One reason companies use full-cost transfer pricing is that it provides relevant costs for _____.
A)long-run decisions even though poor short-run decisions may result
B)long-run decisions and for short-run decisions
C)short-run decisions even though poor long-run decisions may result
D)short-run decisions at the expense of the company

Question

Quizplus · Accepted Answer

Full-cost transfer pricing provides relevant costs for long-run decisions, but it may lead to poor short-run decisions because it includes fixed costs that are not relevant for short-term decision-making.

One Reason Companies Use Full-Cost Transfer Pricing Is That It