Which of these is a transfer pricing methodology that preserves the autonomy of the division managers?
A)cost-plus.
B)actual costs.
C)negotiated.
D)predetermined.

Question

Quizplus · Accepted Answer

The negotiated transfer pricing methodology involves both division managers agreeing on a price for the transfer of goods or services between their divisions. This preserves the autonomy of the division managers as they are able to come to a mutually beneficial agreement without external interference. The other methodologies listed (cost-plus, actual costs, and predetermined) involve more standardized methods for determining transfer pricing, which may not take into account the unique circumstances and needs of each division.

Which of These Is a Transfer Pricing Methodology That Preserves