MNC use of transfer pricing strategies & Cost of Inventory
Not what you're looking for?
1. How might a MNC use transfer pricing strategies? How do import duties affect transfer pricing policies?
2. What costs are associated with inventory? Why is controlling turnover in the inventory important? How can improvements in inventory management affect profitability?
Purchase this Solution
Solution Summary
Solution clearly explains how MNC uses transfer pricing strategies and how import duties affect transfer pricing policies and also costs associated with inventories and why controlling turnover in inventory is important and also how improvements in inventory management affect profitability.
Solution Preview
1. How might a MNC use transfer pricing strategies? How do import duties affect transfer pricing policies?
Answer:
A MNC might use transfer pricing strategies for two basic purposes: (i) Income tax liability reduction (ii) Funds repositioning.
If the tax-rate in the country of the selling affiliate country is less than the tax-rate in the buying affiliate country, a high markup policy on sales will leave little taxable income in the buying affiliate country to be taxed at the higher rate. Even if the tax-rate in the buying affiliate country is not more than that in the selling affiliate country, a high markup policy will leave less funds to be removed from ...
Purchase this Solution
Free BrainMass Quizzes
Introduction to Finance
This quiz test introductory finance topics.
Cost Concepts: Analyzing Costs in Managerial Accounting
This quiz gives students the opportunity to assess their knowledge of cost concepts used in managerial accounting such as opportunity costs, marginal costs, relevant costs and the benefits and relationships that derive from them.
Basics of corporate finance
These questions will test you on your knowledge of finance.
IPOs
This Quiz is compiled of questions that pertain to IPOs (Initial Public Offerings)
Marketing Research and Forecasting
The following quiz will assess your ability to identify steps in the marketing research process. Understanding this information will provide fundamental knowledge related to marketing research.