Some business leaders argue that related-party transactions have benefits for the reporting entity.The benefits are said to include:
A) Lower legal costs associated with contracts.
B) Increased profits for the related entity.
C) Reduced competition among suppliers.
D) Better, more reliable service and better prices.
E) None of the given answers.

Question

Quizplus · Accepted Answer

Related-party transactions can lead to better and more reliable service as the related party may have a better understanding of the reporting entity's needs and preferences. This can also lead to better prices as they may have a vested interest in maintaining a good relationship with the reporting entity.

Some Business Leaders Argue That Related-Party Transactions Have Benefits for the Reporting