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Alternative Cost-Plus Methods Homework Help-Resolving All Your Topic Hurdles

We at myhomeworkhelp.com provide the best alternative cost-plus methods homework help developed by experts which help you in understanding different pricing strategy in various businesses.

What is Cost -Plus Pricing?

It is a pricing strategy whose ultimate goal is to get the entire return on the capital employed. It helps the business in achieving the desired level of profit if the sales continue as projected. For example, A manufacturer has invested $1 million in business and has a predefined ROI at 10% and the unit cost and expected sales are at $10 and 1000 units.

By formulae,{Target-Return Pricing = unit cost + (desired return x invested capital) /unit sales},the company must sell each unit at $20 to achieve 10% ROI.

The alternative pricing mechanisms with alternative cost-plus methods homework help

  • Full-Cost Pricing: As the name suggests the entire cost is first determined, and then a markup is added to get the required profit. Formulae used is {Profit/Total Costs *100=Mark-up %}.

For example, a manufacturer produces four different types of mobiles in the same factory. Even if he stops manufacturing a particular line of mobile phones his rent costs will remain the same.

So, while employing this method, the owner must decide whether to include the cost directly associated with the particular product or consider the overall business.

  • Direct Cost Pricing: In this methodology, only the direct costs are taken into account, and then a markup is added to the additional costs for profit. Formulae used is {Additional Costs+ Profit/Direct Costs *100=Mark-up %}
  • Gross Margin Pricing: Gross Margin is calculated as total sales-cost of goods sold. In this method, fixed costs are not taken into account that is specific to the product. This is best suited in a factory environment where all the variables like man hours are quantifiable and not with an open service.

Alternative cost-plus methods assignment help will provide you with case studies designed by experts to develop a practical viewpoint of the situation.

Need for alternative Cost-Plus Pricing Methods

Different pricing methodologies suit business at various times. For example, during the peak of the harvest season, a rice grower may sell a quintal of rice at $100 but during the end of the season when demand recedes the same may sell at 40-50% discount.

Alternative cost-plus methods assignment help will provide a lucid and straightforward explanation on the need for alternative pricing methods.

Tips for Successful Alternative Cost-Plus Pricing Methods

  1. Be innovative in your pricing and always seek more ways to attract new customers.
  2. Do a cost-benefit analysis before finalizing your Cost Pricing approach.
  3. Maintain a regular timetable to track the performance of your pricing methodology.
  4. Be flexible in your approach to new circumstances in business can arise anytime.

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