Subsidiary X, Located in a Country with a 25% Corporate

Subsidiary X, located in a country with a 25% corporate income tax rate, and Subsidiary Y, located in a country with a 35% corporate income tax rate are part of a decentralized organization. They have been engaged in trade with one another using a negotiated transfer price of $50 per unit for sales by Subsidiary X to Subsidiary Y. Pipko, the parent company of both Subsidiary X and Subsidiary Y recently set a discretionary transfer price of $80 per unit for the transfers between X and Y. What is advantage of this decision?

A) Net income for Subsidiary X will increase by $30 per unit.
B) Net income for the corporation as a whole will increase by $30 per unit.
C) Net income for the corporation as a whole will increase by $3 per unit.
D) Net income for Subsidiary Y will decrease by $30 per unit.