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Could u explain sir
Which one of the following statements are correct and why .
1- marginal cost plus pricing is easier where there is a readily identifiable variable cost.
2-full cost plus pricing requires the budgeted level of output to be determined at the outset.
3-cost plus pricing is a strategically focused approach as it accounts for external factors.
4-cost plus pricing requires that the profit mark up applied by an Organisation is fixed .
I Know that cost plus pricing added 1% of profit on markup and that’s not fixed so statement 4 is wrong .
Marginal cost plus pricing is that to cost of product margin of profit is added and price is formed .Why are you attempting questions for which you do not have an answer?
2 is correct because (as you should remember from Paper MA) we need to know the budgeted production in order to calculate the fixed overheads per unit and therefore the full absorption cost.
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So sorry sir this time i forgot to write the answer…
The answer ist that 1 statement and 2 statement is correct ..
I understood as u said 2 statement is correct .
but why statement 2 is Correct?- Topics: 14
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Oh so sorry i mean to write that i understood from u that statement 2 is correct as u said but
why statement 1 is correct?It would help if you had typed out the question correctly! You wrote that the question said ‘which one” of the statements was correct!!!
Statement one is correct because there is no need to decide on a fixed cost per unit.
I do explain all of this in my free lectures!
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So sorry sie…so sorry…
God bless u always
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