BIRCH PAPER COMPANYCASE 6-2

AGENDA

Summary of the case Issues (what the case deals with) Questions Conclusion

CASE BACKGROUND This case address transfer pricing Birch Paper Company is a medium size

partially integrated company It produces white, kraft papers and

paperboard Birch Paper has four producing division

and a Timberland Division that produces pulp

CASE BACKGROUND CON’TBREAKDOWN OF DIVISIONS

Birch Paper Company

Thompson Division

Northern

Division

Southern Division

Timberland Division

BACKGROUND Each division is judged

independently on the basis of profit and return on investment

Has a policy of decentralizing responsibilities and authority for all decisions except for decisions relating to the overall company policy

SITUATION This Case centres around transfer

pricing