1. Your client is about to introduce a very high-quality product that will remove an invasive form of pepper plant in the southern United States. The Marketing Department has established a price of $37 per gallon, and the company controller has projected total production, selling, and distribution costs of $26 per gallon. What factors should your client consider before introducing the product into the marketplace?
2. Refer to the information is SE7. Should premium Castings use cost-based, or negotiated transfer prices? Why?
3. Jay Patel is planning to open a pizza restaurant next month in Flora, Alabama. He plans to sell his large pizzas for a base price of $18 plus $2 for each topping selected. When asked how he arrived at the base price, he said that his cousin developed that price for his pizza restaurant in New York City. What pricing rules has Patel not followed?