Question: Question 3 A. Define transfer pricing and elaborate on FOUR (4) of its purposes. (14 marks) B. In deciding on a transfer pricing method, advise

Question 3

A. Define transfer pricing and elaborate on FOUR (4) of its purposes. (14 marks)

B. In deciding on a transfer pricing method, advise management on:

i. negotiated transfer pricing

ii. market-based transfer pricing (4 marks)

C. Highlight ONE (1) advantage and ONE (1) disadvantage of the market-based transfer pricing method. (2 marks)

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