Analyze the transfer pricing policy of Toyota Motor Corporation for its internal transactions between different divisions. Calculate the transfer prices for components transferred from the manufacturing division to the assembly division. Consider both cost-based and market-based transfer pricing methods. Evaluate the implications of different transfer pricing methods on divisional performance and overall company profitability.
Values:
•Manufacturing Division Cost per Unit: $50
•Market Price for Components: $60
•Units Transferred: 10,000