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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › transfer pricing
how to calculate the maximum transfer price accepted by the buyer
It is the lower of the net marginal revenue and any external purchase cost.
This is all explained with examples in my free lectures on transfer pricing.
The lectures are a complete free course for Paper PM and cover everything needed to be able to pass the exam well.
Direct Material cost 100
Direct labour cost 80
Total cost (variable 80%) 200
What is tp if company wants to achieve profit margin of 20%
Best regard
This is not a complete question because it is not specified as to what the costs are in each division separately.