Answer:
Pharaoh Company
Income statement
For the year ended June 30, 2017
Revenue & Gains Amount
Service Revenue $7,910
Total revenue & gains (A) $7,910
Expense and losses:
Salaries and wages expense $1,810
Advertising expense $400
Supplies expense $2,370
Utilities expense $270
Maintenance and repair expense $630
Total expense (B) <u>$5,480</u>
Net Income (A - B) <u>$2,430</u>
Answer:
b
Explanation:
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Answer:
Lahdekorpi OY, a Finnish corporation and Three-O Company, a subsidiary incorporated in the United States
Transfer Pricing:
a) The best transfer pricing method in this case is the cost plus method. This gives the transfer price as Cost + 50%.
b) The appropriate transfer price should be $3 ($2 x 1.5).
Explanation:
Transfer pricing arises when controlled entities set prices for exchange of goods and services. When Lahdekorpi OY, a Finnish corporation, sells wooden puzzles to Three-O Company, given their relationship, transfer pricing has arisen. It is the assignment of cost for goods and services exchanged between related parties, like a parent and a subsidiary.
There are many Transfer Pricing methods which entities and the taxing authorities can use to determine the best transfer price. According to the Organisation for Economic Co-operation and Development (OECD) Multinational Entities and tax authorities can use any of these five main transfer pricing methods:
a) Comparable uncontrolled price (CUP) method. The CUP method is grouped by the OECD as a traditional transaction method (as opposed to a transactional profit method)
b) Resale price method
c) Cost plus method
d) Transactional net margin method (TNMM)
e) Transactional profit split method.
Engenuity said to have
1. Option A is not the best choice, because the monthly payments will be too high.
2. Option B is not a good choice, because it requires too high of an up-front cost, and the mileage restriction might be a problem.
3. Option C is the best choice for my budget, and it will allow me to own a car outright once the loan is repaid.
