Several transfer pricing policies are used in practice.Which of the following transfer pricing policies is not used?
A)transfer at market price
B)transfer at negotiated price
C)transfer at cost
D)transfer at zero cost

Question

Quizplus · Accepted Answer

Transfer at zero cost is not a transfer pricing policy used in practice because it does not reflect the actual cost or value of the goods or services being transferred. It may also be seen as a form of tax evasion and can result in tax and legal consequences for the company. Transfer at market price, negotiated price, and cost are commonly used transfer pricing policies.

Several Transfer Pricing Policies Are Used in Practice