Why is transfer pricing important in tax accounting?
What will be an ideal response?
Transfer pricing is important in tax accounting because transfers of goods or services often occurs across different tax jurisdictions (countries, for example). The transfer price affects the revenue and cost that are reported in the different jurisdictions. If the different jurisdictions have different income tax rates, the total tax liability across all jurisdictions will depend on the transfer price.
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Define positioning.
What will be an ideal response?
According to a study sponsored by The Committee of Sponsoring Organizations (COSO), the most common way to manipulate revenue accounts is by:
a. reclassifying expenses as revenues. b. recording fictitious revenues. c. inappropriately reducing sales returns and allowances. d. prematurely recording revenue.
The days' payable shows how long, on average, a company takes to pay its accounts payable
Indicate whether the statement is true or false
Less than half of the information communicated through the grapevine is accurate
Indicate whether the statement is true or false