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Could anyone explain in more detail these two new pricing models found in transfer prices...i.e. the formulas used to arrive at the final sales price.
My understanding is that the transfer prices control inter-company sales prices from a lending company to a borrowing company...so the explanation of the first option ('transferred to the lending legal entity) is a little confusing.
If the lending company raises an internal project invoice to the borrowing company for £1000.00 and and I use a pricing figure of 10.00 my assumption is:
Percent of sales price = £1100.00 (i.e. 1000 + 10%) or is it £100.00 (10% of 1000) or ???
Amount below sales price = £900.00 (i.e. 1000 - 10%)
Thanks in advance.
Agree that the explanation of the first option ('transferred to the lending legal entity') is a bit confusing.
My understand is that 'percentage of sales price' defines a price that is higher or lower than the sales price that you charge external parties. As an example, if a normal customer is charged $100 and you define percent of sales price 90% your internal intercompany trading partner will be charged $90.
The amount below sales price works the same. Let's say that the normal sales price is $100 and you specify $5 amount below sales price then the intercompany price id $95.
Please double check/test and probably make a suggestion to MS to improve the description on MS docs.
Many thanks and best regards,
Thank you Ludwig
I will give it a try.
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