BKAT ASSIGNMENT 2

What was the primary issue in the Medtronic transfer pricing case?

• Medtronic's failure to file tax returns on time

• Dispute over the pricing of transactions between Medtronic's U.S. operations and its subsidiaries in Puerto Rico

• Allegations of fraudulent financial reporting

• Medtronic's acquisition of another medical device company

Which method did Coca-Cola use to justify its profit allocation that was ultimately rejected by the IRS in the transfer pricing dispute?

• Comparable Uncontrolled Price (CUP) Method

• Resale Price Method (RPM)

• Cost Plus Method

• Comparable Profits Method (CPM)

Transfer pricing regulations in Malaysia are entirely different from the OECD Transfer Pricing Guidelines.

• TRUE

• FALSE

Penalties will be imposed if companies fail to keep proper documentation and do not use arm's length pricing

• TRUE

• FALSE

Aggressive transfer pricing strategies can lead to allegations of tax avoidance.

• TRUE

• FALSE

Transfer pricing is used when divisions of an organization need to charge other divisions of the same organization for goods and services they provide to them.

• TRUE

• FALSE

What is Transfer Pricing?

• The process of setting prices for goods and services exchanged between different divisions of the same company.

• The process of setting prices for goods and services in international trade.

• The process of setting prices for goods and services within a single division of a company.

• The process of setting prices for goods and services in the retail industry.

In Malaysia, transfer pricing regulations require companies engaged in cross-border related party transactions to prepare and submit transfer pricing documentation to demonstrate that the transaction prices comply with the arm's length principle.

• TRUE

• FALSE

Transfer pricing regulations to ensure that transactions between related entities are conducted at arm's length, meaning the prices are different as those charged between unrelated parties.

• TRUE

• FALSE

One of the challenges in transfer pricing is determining the appropriate allocation of costs and revenues among different subsidiaries of a multinational corporation, especially when intangible assets like patents or trademarks are involved.

• TRUE

• FALSE