Transfer Pricing (Price) With Residual Income Target (ICAN May, 2024) Performance Management

This video explains the transfer pricing (price) with the residual income target using question from the performance Management of ICAN , May, 2024.
The video is also useful to students preparing for CIMA Management Accounting, undergraduate and post graduate studies, ACCA, ICAEW,ACCA F5, ICAG, ZICA, CPA, CFA, SICA and various other professional bodies.
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[@Bentikay]

I cannot hide the fact that, your RUclips lectures really help me in the last Exam. I downloaded almost all the videos on FR and PM which I use with Omolehinwa and teach yourself Financial Reporting. I used your videos to start all the topics before using Text books to read further. I passed the 2 subjects. Thank you for not deleting the lectures. 🎉🎉thank.

[@yusufawoyemi3773]

Thanks sir for this solution. Sir this particular question is repeated question in Nov 2021 diet question 7. In Nov 2021 question 7, variable unit cost of #4.90 is under Alba division but in this diet may 2024 the variable unit cost of #4.90 is under Beta division

[@Ezikan]

If you look at the 4.90, it is not directly under Beta.
I never knew the question has been set before until you said so

[@Ezikan]

When I actually compare my solution with the diet you mentioned, it was the same

[@yusufawoyemi3773]

@@Ezikan in Nov 2021 question 7 variable cost is clearly stated under Alba. Please sir check the question and compare it to may 2024 diet question

[@Ezikan]

@yusufawoyemi3773 Beta cannot incur such variables cost.
The variable cost of the buying division are usually the cost of transferring the transfered product to finished goods which has been stated to be #4.50 and the inter divisional transfer which is the transfer price

[@Ezikan]

No constraints and variable cost are both refer to alba and not beta