Midland Inc.has two divisions: production and marketing,which it treats as profit centers.Because the production division has no marketing capabilities,it does not have a traditional market price to consider and the company does not want to use negotiation.Required:
Discuss the following cost-based transfer prices along with problems that might exist for each.1)Standard unit-level cost.2)Absorption (full)cost.3)Actual cost.

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The Answer of Midland Inc.has two divisions: production and marketing,which it treats as profit centers.Because the production division has no marketing capabilities,it does not have a traditional market price to consider and the company does not want to use negotiation.Required:
Discuss the following cost-based transfer prices along with problems that might exist for each.1)Standard unit-level cost.2)Absorption (full)cost.3)Actual cost.