1. An investment opportunity with a residual income that equals or exceeds the company's required rate of return should be accepted.

True or False

2. A cost-based transfer price should be based on standard unit costs, not actual costs.

True or False

3. The most desirable way to set a transfer price is to base it on either variable cost or total cost.

True or False

4. In a responsibility reporting system, the reports of a particular manager contain summary information about the revenue and cost items directly under his or her control and detailed data on the activities of the responsibility centers that fall under his or her chain of authority.

True or False

5. Investment centers are often evaluated on the basis of return on investment.

True or False