Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Target costing
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Sharonlee.
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- April 26, 2025 at 4:11 am #716980
In target cost we establish, does it involve design cost like R&D or just the cost of manufacturing and selling it per unit of product?
April 26, 2025 at 7:02 am #716983Yes, both design costs (r&d) and manufacturing are considered.
This means controlling costs from the design stage to ensure that the total cost per unit, including design and manufacturing, meets the target cost.
April 26, 2025 at 8:51 am #716988Isn’t that design cost more likely to be included as part of the costing in life cycle costing?
April 26, 2025 at 2:35 pm #716998That’s a different topic
And yes design cost would be more likely in a lifecycle question.
But that wasn’t what you askedApril 29, 2025 at 1:23 am #717044I’m just trying to relate the topic. As I thought design cost will be part of R&D cost and R&D is usually treated as period cost. So, special thing about target costing is it considers design cost also? Thank you so much for your clarification!
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