Which one of the following establishes an "arm's-length price" by using the sales prices of similar products made by unrelated firms?
A) Wholesale-price method.
B) Retail-price method.
C) Related-products method.
D) Cost-plus method.
E) Comparable-price method.

Question

Quizplus · Accepted Answer

The Comparable-price method establishes an "arm's-length price" by using the sales prices of similar products made by unrelated firms. This method compares prices of identical or similar products sold in the market to determine a fair market value. The other methods listed do not necessarily use comparable prices to determine arm's-length prices.

Which One of the Following Establishes an "Arm's-Length Price" by Using