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Author Question: The principle by which the tax authorities allow firms to reduce their tax liability by the amount ... (Read 177 times)

vicky

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Question 1

If a foreign subsidiary is located in a low tax country, the parent company would probably use a ________.
◦ high transfer price on inventory shipped from the parent to the subsidiary
◦ high transfer price on goods sold by the subsidiary to the parent
◦ tax credit price to minimize local tax liabilities
◦ low transfer price on inventory shipped from the subsidiary to the parent

Question 2

The principle by which the tax authorities allow firms to reduce their tax liability by the amount of income taxes paid to foreign governments is known as ________.
◦ transfer pricing
◦ lag strategies in tax planning
◦ a tax credit
◦ passive income reductions


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Marked as best answer by vicky on Sep 4, 2019

lorealeza

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