Exercises and Problems trarder prin. a. Improving the competitive position of Man operation. c....

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Exercises and Problems trarder prin. a. Improving the competitive position of Man operation. c. Protecting foreign currency cash flaw nom cunriamy devaluabort Nliniminng income tax. when transferring to a 1ov...country. Whikh of the following methods does US. tw law always require robe used in Pr..% itt,erromP, trat.5. Or tnllble property' a. Comparable uncontrolled pnre method. 3. Which international organnabon haL developed transfer pricing gniderm. that are used as the haw for transfer pricing Laws in several cow... a. World Bank. 5. Which of the following is not a method commonly usedfor establnhing Mari, a. Cost-bawd nansfer price. b. Negotiated price. situabons? uct internally rather Man externally. c. When gm market .r the product. perfectly competeve. d. All of the above. 7. U.S. Treasury Xemilanoes require the use of one of five sperified method, to c. Profit split method.
Use theJonowing information to courplel, Nem., 10-12: Z=e;r0 '" =74PTM= pe¦re. 10. Which of the following would be en acceptable transfer price under the resale b. $750 c. $795 d. $ XXXXXXXXXXWhich of the Wowing would he an acceptable transfer price under the cost-plus method? b. $750 c. $795 d. $ XXXXXXXXXXwhich of dwfollowing would he an acceptable 1-ranger price under the com- a. Szoo b. $750 c $795 d. $825

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David · Accepted Answer

1.c.  Protecting foreign currency cash flows from currency devaluation. 
Reasoning: As per the transfer pricing rule, a high transfer price 
needs to be used to protect the foreign currency cash flows from 
currency devaluation. Therefore, this objective is not achieved when 
using a low transfer price. Also, using a lower transfer pricing 
achieves the objectives of improving the competitive position of a 
foreign operation, minimizes the import duties and minimizing the 
income taxes when transferring to lower-tax country.
2. d. Best method 
Reasoning:

Exercises and Problems trarder prin. a. Improving the competitive position of Man operation. c. Protecting foreign currency cash flaw nom cunriamy devaluabort Nliniminng income tax. when transferring...

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