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Transfer Pricing at Toyota Values: Division A Cost: $50,000,000 Division B Revenue: $70,000,000 Market-Based Transfer Price: $60,000,000 Requirements: Analyze the transfer pricing issue between Toyotas

Transfer Pricing at Toyota

    • Values:
      • Division A Cost: $50,000,000
      • Division B Revenue: $70,000,000
      • Market-Based Transfer Price: $60,000,000
    • Requirements:
      1. Analyze the transfer pricing issue between Toyota’s divisions.
      2. Calculate the divisional profit under the market-based transfer price.
      3. Discuss the challenges of transfer pricing in global automotive manufacturing.
      4. Recommend strategies to improve inter-divisional coordination and profitability.

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