Companies are prohibited from charging a transfer price when moving goods between profit centers.

Question

Companies are prohibited from charging a transfer price when moving goods between profit centers.​

Quizplus · Accepted Answer

Companies are not prohibited from charging a transfer price when moving goods between profit centers. Transfer pricing is a common practice in multinational companies to allocate costs and profits among different divisions or subsidiaries. However, governments may regulate transfer pricing to prevent tax avoidance and ensure fair competition.

Companies Are Prohibited from Charging a Transfer Price When Moving