Exam 10: Decentralization: Responsibility, Accounting, Performance Evaluation, and Transfer Pricing

Which of the following is NOT an environmental factor affecting performance evaluation in the multinational firm?

How are accountability, information, and responsibility, related?

Which of the following is an economic factor affecting performance evaluation in a multinational firm?

In a multinational firm, it is important to separate the evaluation of a division manager from the __________ .

The Engine Division provides engines for the Tractor Division of a company. The standard unit costs for the Engine Division are as follows: What is the transfer price based on variable product costs plus 20 percent?

When there is an outside market for an intermediate product that is perfectly competitive, the most equitable method of transfer pricing is

Panther Company had the following historical accounting data per unit: The units are normally transferred internally from Division A to Division B. The units also may be sold externally for $210 per unit. The minimum profit level accepted by the company is a markup of 30 percent. There were no beginning or ending inventories. What would be the transfer price if Division X uses full cost plus markup?

A type of fringe benefit received over and above salary is(are) called:

The transfer price that would leave the buying division no worse off if an input is purchased from an internal division is(are) called:

In the Bombadier Company, Division A has a product that can be sold either to outside customers or to Division B. Information about these divisions is given below: The company uses the opportunity cost approach to transfer pricing. Which case should not be transferred internally?

The "floor" in transfer pricing is

In the Bombadier Company, Division A has a product that can be sold either to outside customers or to Division B. Information about these divisions is given below: The company uses the opportunity cost approach to transfer pricing. What is the maximum transfer price in Case 1?

In the Bombadier Company, Division A has a product that can be sold either to outside customers or to Division B. Information about these divisions is given below: The company uses the opportunity cost approach to transfer pricing. What is the minimum transfer price in Case 2?

A responsibility center is a part of a business whose workers are accountable for specified activities.

One of the reasons for decentralization is more timely response. This means

An example of an investment center is a

The after-tax operating profit minus the total annual cost of capital equals the:

limitations make it difficult for any central manager to know everything about all products and markets.

managers can make better decisions using information.

Which of the following departments is likely to be an investment center?