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Division a Produces a Component and Wants to Sell It

Question 46

Multiple Choice

Division A produces a component and wants to sell it to Division B.What does the transfer price represent for each division?


A) revenue to Division A and a cost to Division B
B) revenue to Division B and a cost to Division A
C) revenue to Division A and no effect on Division B
D) a cost to Division B and no effect on Division A

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