Transfer price must be considered when setting budgets and evaluating a subsidiary's performance.

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Transfer prices are the prices at which goods or services are transferred between different units or divisions of the same company. These prices can affect the profitability of each unit and therefore impact the overall performance of the company. When setting budgets and evaluating the performance of a subsidiary, transfer prices must be taken into consideration to ensure accurate analysis of its financial results.

Transfer Price Must Be Considered When Setting Budgets and Evaluating