One approach to the development of a transfer price is to use the market value if the item has an existing market at the time of transfer.

Question

Quizplus · Accepted Answer

This statement is true. Using the market value is one method for developing a transfer price, particularly when the item being transferred has an established market. This method helps to ensure that the transfer price is consistent with competitive market pricing and can prevent distortions in company financial results.

One Approach to the Development of a Transfer Price Is