Question

A transfer price is:

a. the price charged when one segment of a company provides goods or services to an individual customer who transfers the purchased goods overseas.
b. the price charged when one segment of a company provides goods or services to another segment of the same company.
c. the price charged when one segment of a company provides goods or services to another company who transfers the purchased goods overseas.
d. the price charged when one segment of a company provides goods or services to a non-profit or governmental oraanization who then transfers the purchased aoods overseas.

Answer 1

A transfer price is the price charged between segments of the same company for goods or services.

Step-by-step explanation:

The term transfer price refers to the price charged when one segment of a company provides goods or services to another segment of the same company.

It is an internal transaction and pricing strategy used by various segments of the same company, often for goods, services, or labor provided between these segments, especially when such segments are treated as separate profit centers. The correct answer in this context is option b.

the price charged when one segment of a company provides goods or services to another segment of the same company. It's essentially the internal price set for transactions between different departments or divisions within the same company.