A major reason for transfer pricing is to communicate data that will lead to goal-congruent decisions.

Question

Quizplus · Accepted Answer

Transfer pricing is used to communicate data on the internal transactions within a company. The goal of transfer pricing is to align the interests of the different divisions or departments within the company and to ensure that decisions made are in the best interest of the organization as a whole. Therefore, transfer pricing is designed to lead to goal-congruent decisions.

A Major Reason for Transfer Pricing Is to Communicate Data