A transfer price is the price charged by one unit for a good or service provided to another unit within the organization.

Question

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A transfer price is the charge by one unit in the organization for a good or service that it supplies to another unit of the same organization.For example,in automobile manufacturing,a transfer price may be affixed to components and subassemblies before they are shipped to subsequent business units for final assembly.

A Transfer Price Is the Price Charged by One Unit