Transfer Pricing part 2 - ACCA Performance Management (PM)

Transfer Pricing part 2
“Sensible” transfer pricing to achieve goal congruence
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[@revocatuscharles7808]

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[@parvathysanthosh4421]

Very good explanation.... Thanks a lot👍

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Thank you for your comment :-)

[@kudzaimutambirwa9951]

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[@priyankajaiswal7756]

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[@vishalsmh9282]

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[@HazSut]

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[@ramsadhsameen5439]

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[@raju.m5740]

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[@blackm9063]

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[@AbdulRahman-kn5zw]

Sir what would be an answer for this type of question A firm has 2 divisions (A nd B )and uses full cost to transfer goods at internal division (B) and External sales. Internal transfer is at full cost of 28$/unit and external at 30$/unit. Divison B has got an opportunity to purchase the goods externally at 25$/unit. Varaible Cost is 20$ Without including 1.5$ saving on internal transfers. What would be the reduction in the group profit if Division B takes to purchase from external supplier 10,000 units?

[@ok_sana000]

65,000?

[@JFoley123456]

Wouldn’t you need to know the selling price for b

[@speedlive6106]

50000$ as marginal cost of producing is 20 but we are buying it from externally for 25 So 5$ increase in cost per unit .

[@ANA-db9yn]

This lecturer is sleepy & sleeping as well 👎

[@whatevermalik3630]

He probably forgot that you paid for it.