Target Costing Homework Help
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What is Target Costing?
If a company want to achieve the price points, product costs and margins for a new product, prior to it a target cost is needed to be developed for such product. It contains many factors related to manufacturing of the product and if the planned levels are not achieved in manufacturing, then the whole project is cancelled. This whole target cost aims the costs involved in manufacturing the product right from the entrance of product design phase till they got out through product life cycles. In this Target costing homework help article, we discuss the primary steps in target costing technique.
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Steps in Target Costing
In this Target costing homework help article, given below are the steps through which Target costing is achieved.
1. Conduct research:usually, the research of marketplace where the product is going to be launched in necessary. As per that research only the set of features for the product is determined. As per our Target costing homework help article writers, though comparison with similar kind of products in market, a price can be decided.
2. Calculate maximum cost: a marginalised gross cost for the product is provided by the company to the design team, that depicts the monetary expectations of the company from the product. The maximum cost target can be achieved easily by subtracting the mandated gross margin from the projected product price.
3. Engineering the product: all the quality level checks are performed on the item before delivering it in market and it should satisfy all the design aspects and safety factors. As per our Target costing homework help writers say, it is important to define the durability of the product.
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