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Evaluate and discuss the implications of the following transfer pricing policies: Transfer price = cost plus a mark-up for the selling division Transfer price =

Evaluate and discuss the implications of the following transfer pricing policies:

  • Transfer price = cost plus a mark-up for the selling division
  • Transfer price = fair market value
  • Transfer price = price negotiated by the managers

Why is transfer pricing such a significant issue both from a financial and managerial perspective?

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