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

Question

Quizplus · Accepted Answer

Full-cost transfer pricing includes all costs, making it suitable for long-term decision-making, but it may not reflect the most relevant costs for short-term decisions, potentially leading to poor short-term outcomes.

One Reason Companies Use Full- Cost Transfer Pricing Is That