Account For Management Decision Making
Week 6 Learning Resources
Centralized Or Decentralized
Most mid-size to large organizations is structured as either centralized or decentralized businesses. A centralized business is one that is structured to place the major decision-making and strategic planning in a single individual. A decentralized business is the opposite, where the business is divided into segments or groups with the decision-making residing in each of these smaller segments. Both organizational structures have several advantages and disadvantages that affect the managerial accounting functions.
To prepare for this Discussion:
- Review this week's Learning Resources.
- Identify an organization with which you are familiar and consider its organizational structure with regard to being centralized or decentralized.
Post an analysis of the organizational structure in managerial decision making, to include the following:
- Briefly describe the organization that you chose.
- Explain the organization structure in terms of being centralized or decentralized and how you determined the structure type.
- Describe three advantages to this structure.
Account For Management Decision Making
Week 6 Learning Resources
Transfer Pricing
Many companies today have multiple divisions located in various countries around the globe. For example, Division A might make shoelaces that it sells to retail outlets, but Division B might make shoes and need laces for those shoes. Division A is able to sell laces to Division B. The question is what price should Division A sell the laces to Division B? This exchange between divisions of the same company is called transfer pricing, which you will explore further in these resources.
· Franklin, M., Graybeal, P., & Cooper, D. (2019). Why it mattersLinks to an external site. . In Principles of accounting, volume 2: Managerial accounting . OpenStax. https://openstax.org/books/principles-managerial-accounting/pages/9-why-it-matters
· Franklin, M., Graybeal, P., & Cooper, D. (2019). 9.1 differentiate between centralized and decentralized managementLinks to an external site. . In Principles of accounting, volume 2: Managerial accounting . OpenStax. https://openstax.org/books/principles-managerial-accounting/pages/9-1-differentiate-between-centralized-and-decentralized-management
· Franklin, M., Graybeal, P., & Cooper, D. (2019). 9.2 describe how decision making differs between centralized and decentralized environmentsLinks to an external site. . In Principles of accounting, volume 2: Managerial accounting . OpenStax. https://openstax.org/books/principles-managerial-accounting/pages/9-2-describe-how-decision-making-differs-between-centralized-and-decentralized-environments
· Franklin, M., Graybeal, P., & Cooper, D. (2019). 9.4 describe the effects of various decisions on performance evaluation of responsibility centersLinks to an external site. . In Principles of accounting, volume 2: Managerial accounting . OpenStax. https://openstax.org/books/principles-managerial-accounting/pages/9-4-describe-the-effects-of-various-decisions-on-performance-evaluation-of-responsibility-centers
· Plante & Moran. (2018, May 3). The perils of basing management decisions on the transfer priceLinks to an external site. . https://www.plantemoran.com/explore-our-thinking/insight/2018/05/the-perils-of-basing-management-decisions-on-the-transfer-price
· Sprague, C. (2021). Tax impact on decisionsLinks to an external site. . In Salem Press Encyclopedia.
· Walden University, LLC. (2021). How to calculate transfer pricing Download How to calculate transfer pricing [PDF].Walden University Canvas. https://waldenu.instructure.com
· Walden University, LLC. (2021). Transfer-pricing methods [Video]. Walden University Canvas. https://waldenu.instructure.com
· Walden University, LLC. (2021). Transfer pricing Download Transfer pricing [PDF]. Walden University Blackboard. https://waldenu.instructure.com
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Transfer Pricing
| Week 6 Assignment | |||
| Full Cost | Variable Cost | ||
| Alpha Division Taxes: | |||
| Transfer Price | |||
| Less (subtract) Cost | |||
| Taxable Income | 0 | 0 | |
| Taxes (or refund) | |||
| Beta Division Taxes: | |||
| Sales Price | |||
| Less (subtract) Transfer Price | |||
| Taxable Income | 0 | 0 | |
| Income Taxes | |||
| Import Duty | |||
| Taxes (or refund) | 0 | 0 | |
| Total Taxes |
,
Week 6 Assignment: Accounting Tools and Measures for Decision Making—Part 3
Prepared by: Replace this text with your name.
Date: Replace this text with the submission date.
Walden University
MBAX 6050: Accounting for Management Decision Making
Transfer Pricing
Replace this text with introductory information. Add or remove headings as necessary.
[Heading]
Insert your calculations of the full-cost transfer pricing method and the variable-cost transfer pricing method from Excel. Add or remove headings as necessary. For information on inserting data from Excel into Word, refer to the following: Microsoft. (n.d.). Insert a chart from an Excel spreadsheet into Word. https://support.microsoft.com/en-us/office/insert-a-chart-from-an-excel-spreadsheet-into-word-0b4d40a5-3544-4dcd-b28f-ba82a9b9f1e1
[Sub-Heading]
Replace or remove this text. Add or remove headings as necessary.
References
[Please delete this note before submitting your Assignment. For more information about formatting your reference list, please visit the following site: https://academicguides.waldenu.edu/writingcenter/apa/references .]
Include appropriately formatted references to support your Assignment. Refer to the Assignment guidelines for further information on the requirements.
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