COST ACCOUNTING
TRANSFER PRICING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Following are the implications of special relations and transfer pricing, except
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Income reported is less than it should be
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Expenses are reported appropriately
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Cost Exceeded should be
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Transactions are not reported at fair prices
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Explanation:
Detailed explanation-1: -Transfer pricing allows for the establishment of prices for the goods and services exchanged between subsidiaries, affiliates, or commonly controlled companies that are part of the same larger enterprise. Transfer pricing can lead to tax savings for corporations, though tax authorities may contest their claims.
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