[Verse 1] In the boardroom where divisions meet Cost-plus pricing takes the driver's seat Variable costs plus allocated overhead Fixed markup percentage, clearly spread Manufacturing sends to retail chain Adding fifteen percent for their domain [Chorus] Cost-based builds from the bottom up Variable plus fixed fills the cup Negotiated means we compromise Between the floor and ceiling price Transfer pricing in the family tree Internal deals set subsidiaries free [Verse 2] Full cost method captures everything Direct materials, labor's offering Factory burden spreads across the board Every penny tracked and carefully stored But when capacity sits underused Variable costing keeps us unconfused [Chorus] Cost-based builds from the bottom up Variable plus fixed fills the cup Negotiated means we compromise Between the floor and ceiling price Transfer pricing in the family tree Internal deals set subsidiaries free [Verse 3] Negotiated pricing takes the stage When market forces turn another page Division managers hash it out Between the minimum and maximum route Goal congruence guides the conversation Optimal for the entire corporation [Bridge] When external markets don't exist Cost-based pricing tops the list But when competitive prices shine Negotiation draws the line Capacity constraints change the game Variable floors stake their claim [Chorus] Cost-based builds from the bottom up Variable plus fixed fills the cup Negotiated means we compromise Between the floor and ceiling price Transfer pricing in the family tree Internal deals set subsidiaries free [Outro] Choose your method, know your facts Cost recovery or market pacts Transfer pricing strategy Builds corporate harmony
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