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exercise 19-31 (algo) general transfer pricing rule [lo 19-4] scottsdale manufacturing is organized into two...

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Accounting

Exercise 19-31 (Algo) General Transfer Pricing Rule [LO 19-4] Scottsdale Manufacturing is organized into two divisions: Fabrication and Assembly. Components transferred between the two divisions are recorded at a predetermined transfer price. Standard variable manufacturing cost per unit in the Fabrication Division is $350. At the present time, this division is working to capacity. Fabrication estimates that the units it produces could be sold on the external market for $580. The product under consideration is viewed as a commodity-type product, with no differentiating features or characteristics. Required: 2. Based on the general transfer pricing rule presented in the chapter, what is the minimum transfer price between units when the Fabrication Division

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