An appropriate transfer price is one that considers the risks, assets, and functions of the persons to whom income is assigned.

Question

Quizplus · Accepted Answer

An appropriate transfer price should indeed consider the risks, assets, and functions of the parties involved, as these factors influence the value and cost of transactions between different parts of an organization or between related entities. This ensures that the transfer price reflects the economic reality of the transactions.

An Appropriate Transfer Price Is One That Considers the Risks