It explains the difference between the following two key financial factors in international operations: (a) International transfer of funds and (b) transfer prices. What value do they have in international business?
A fund transfer is a process of events movement of funds from remitte to benificiary or home country.Remitte transfer funds to himself or his family members.whereas transfer price means prices of products or services transfer to one to another person's or one business to another business under common control.
Example of fund transfer is SBI(USA) fund transfer to It's subsidiary bank SBI(INDIA).
Example of transfer prices means Consider Sai Co., a U.S. based pen company manufacturing pens at a cost of 10 cents each in the U.S. Sai Co.'s subsidiary in Canada, Ram Co., sells the pens to Canadian customers at $1 per pen and spends 10 cents per pen on marketing and distribution. The group's total profit amounts to 80 cents per pen.
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