Explanation Cost-plus pricing: Cost-plus pricing is a technique of pricing where the price is calculated by adding a margin to the total cost of the product. The total cost of the product includes all the variable and fixed cost of the product. Product A has a total cost of $10 per unit. It is charging 10% as profit margin then the price will be $11 ( $ 10 + ( 10 × 10 % ) )

6th Edition

ISBN: 9781264022021

Author: LANEN

Publisher: MCG

See similar textbooks

Question

Chapter 4, Problem 9RQ

To determine

Define the situation to use cost-plus pricing.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Chapter 4, Problem 8RQ

Chapter 4, Problem 10RQ

Students have asked these similar questions

What are the advantages and disadvantages of target pricing versus cost-based pricing?

What Is Prerequisites for Successful Target and Cost-Based Pricing?

Determining the best approach to pricing requires a cost-benefit trade-off. Explain.

Chapter 4 Solutions

COST ACCOUNTING W/CONNECT

Ch. 4 - Fixed costs are often defined as fixed over the...Ch. 4 - What is the difference between a sunk cost and a...Ch. 4 - Are sunk costs ever differential costs? Explain.Ch. 4 - What is the difference between short-run and...Ch. 4 - What costs are included in the full cost of a...Ch. 4 - What costs are included in the full cost of a...Ch. 4 - What costs should be considered for a special...Ch. 4 - What are life-cycle product costing and pricing?Ch. 4 - Prob. 9RQ Ch. 4 - What do the terms target cost and target price...

Ch. 4 - What is predatory pricing? Why is it illegal in...Ch. 4 - What is dumping? What role would a cost accountant...Ch. 4 - What is price discrimination? How could a cost...Ch. 4 - If we want to maximize profit, why do we use unit...Ch. 4 - A company has learned that a particular input...Ch. 4 - Why are production constraints important in...Ch. 4 - What are some nonfinancial factors in decisions to...Ch. 4 - Prob. 18RQ Ch. 4 - Prob. 19CADQ Ch. 4 - Prob. 20CADQ Ch. 4 - As a marketing manager for an airline, would you...Ch. 4 - Prob. 22CADQ Ch. 4 - You buy an airline ticket to New York City to see...Ch. 4 - Consider the Business Application item,...Ch. 4 - One of your acquaintances notes, This whole...Ch. 4 - A manager in your organization just received a...Ch. 4 - Many airline frequent-flier programs upgrade elite...Ch. 4 - Consider the opportunity costs you identified in...Ch. 4 - Prob. 29CADQ Ch. 4 - Prob. 30CADQ Ch. 4 - Prob. 31CADQ Ch. 4 - Prob. 32CADQ Ch. 4 - Prob. 33CADQ Ch. 4 - Prob. 34CADQ Ch. 4 - Prob. 35CADQ Ch. 4 - Prob. 36E Ch. 4 - Prob. 37E Ch. 4 - Pricing Decisions Assume that MTA Sandwiches sells...Ch. 4 - Pricing Decisions Rutkey Collectibles is a small...Ch. 4 - Prob. 40E Ch. 4 - Special Order Fairmount Travel Gear produces...Ch. 4 - Target Costing and Pricing Sids Skins makes a...Ch. 4 - Target Costing and Pricing Domingo Corporation...Ch. 4 - Target Costing and Purchasing Decisions Mira Mesa...Ch. 4 - Target Costing Kearney, Inc., makes kitchen tools....Ch. 4 - Make-or-Buy Decisions Mobility Partners makes...Ch. 4 - Make-or-Buy Decisions Mels Meals 2 Go purchases...Ch. 4 - Prob. 49E Ch. 4 - Dropping Product Lines Freeflight Airlines is...Ch. 4 - Pappy’s Toys makes two models of a metal...Ch. 4 - Christine’s Chronographs makes two models of a...Ch. 4 - Unter Components manufactures low-cost navigation...Ch. 4 - Special Orders Sherene Nili manages a company that...Ch. 4 - Prob. 55P Ch. 4 - M. Anthony, LLP, produces music in a studio in...Ch. 4 - Davis Kitchen Supply produces stoves for...Ch. 4 - Make or Buy King City Specialty Bikes (KCSB)...Ch. 4 - Prob. 59P Ch. 4 - Prob. 60P Ch. 4 - Prob. 61P Ch. 4 - Prob. 62P Ch. 4 - Prob. 63P Ch. 4 - Agnew Manufacturing produces and sells three...Ch. 4 - Prob. 65P Ch. 4 - Power Music owns five music stores, where it sells...Ch. 4 - You have been asked to assist the management of...Ch. 4 - Prob. 68P Ch. 4 - Prob. 69P Ch. 4 - Prob. 70P Ch. 4 - Prob. 71P Ch. 4 - Prob. 72P Ch. 4 - Slavin Corporation manufactures two products,...Ch. 4 - Prob. 74P Ch. 4 - Prob. 75P

Knowledge Booster

Similar questions

SEE MORE QUESTIONS

Recommended textbooks for you

Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Survey of Accounting (Accounting I)
Accounting
ISBN:9781305961883
Author:Carl Warren
Publisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Business Its Legal Ethical & Global Environment
Accounting
ISBN:9781305224414
Author:JENNINGS
Publisher:Cengage
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub