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Consider the following statements regarding transfer prices: I. Transfer price refers to the amount charged for goods and services exchanged between two divisions. II.

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Consider the following statements regarding transfer prices: I. Transfer price refers to the amount charged for goods and services exchanged between two divisions. II. The full cost transfer-pricing method can lead to dysfunctional decision-making behavior by managers. III. If the producing division has excess capacity, the general transfer-pricing rule and the external market price yield the same transfer price. Which of the above statements is (are) true? OI and II. I, II, and III. I and III. I only. Oll only.

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