Are those set for goods or services which are bought by one division of a firm from another division.

Resale price method is often used.

It takes the price at which an associated enterprise sells a product to a third party.

Traditional transaction methods rely on actual transactions.

Compares the terms and conditions (including the price) of a controlled transaction to those of a third party transaction.

Resale Price Method is also known as the Resale Minus Method.

Transaction between the taxpayer and an independent enterprise.

There are six transfer pricing methods that may be used to examine the arms length nature of controlled transactions.

These methods measure the net operating profits realized from controlled transactions and compare that profit level to the profit level realized by independent enterprises.

Are used to calculate or test the arm‘s length nature of prices or profits.