Process costing

 Weighted-average method:
Total Equivalent units = Finish Goods (FGs)
+ Units transferred to the next department
+ Ending WIP equivalent units
Beginning WIP cost+ Cost incurred∈this period
Unit cost = Total Equivalent units

 FIFO method:
Total Equivalent units = Equivalent Units to complete Beginning WIP units
+ FGs
+ Units transferred to the next department
– Beginning WIP units
+ Ending WIP equivalent units

Total Equivalent units = Equivalent Units to complete Beginning WIP units

+ Units started to produce this period
– Ending WIP units
+ Ending WIP equivalent units
Cost incurred ∈this period
Unit cost = Total Equivalent units

CVP
 CM per unit = Selling price per unit – VC per unit

CM per unit CM Sales−VC

 CM ratio = Selling price per unit = Sales = Sales

 Net Income = (Sales – VC) – FC

= CM per unit × Q – FC
= CM ratio × Sales – FC

 ∆ NI = CM per unit × ∆ Q - ∆ FC
= CM per unit × ∆ Q ; Điều kiện: FC không đổi
= CM ratio × ∆ Sales - ∆ FC

FC
 Unit sales to break even = CM per unit

FC
Dollar sales to break even = CM ratio

Target profit + FC
 Unit sales to attain the target profit = CM per unit

Target profit + FC
Dollar sales to attain the target profit = CM ratio

 Margin of safety (MoS):

MoS in dollars = Total sales - Break-even sales
MoS ∈dollars
MoS in units = Selling price per unit
MoS∈dollars MoS∈units
MoS% = Sales = Unit sales
 FC
 BE% = CM 100%
× = 1 − MoS%

CM 1
 Degree of Operating Leverage (DOL) = Net operating income = MoS %

Unit price = Cost base per unit + Mark.up% × Cost base per unit

 Absorption costing:
Cost base per unit = Production unit cost
= (DM + DL + V.MO + F.MO) per unit

V . SGA + F . SGA + Target profit

Markup % = Cost base per unit ×Units sold
× 100%

 Variable costing:
Cost base per unit = VC per unit
= (DM + DL + V.MO +V.SGA) per unit

F . MO+ F . SGA +Target profit

Markup % = Cost base per unit × Units sold
× 100%

 Full cost:
Cost base per unit = Full costs per unit
= (DM + DL + V.MO + F.MO +V.SGA + F.SGA) per unit

Target profit
Markup % = Cost base per unit × Units sold
× 100%

Cost-plus pricing.
Price skimming. Bánh trung thu
Penetration pricing. Học phí, mì gói
 Value-based pricing.
Psychological pricing: Định giá dựa trên tâm lý
Vd: Định giá lẻ, đi cắt tóc
Bundle pricing.
Different

Premium pricing: Định giá cao

Vd: Các thương hiệu cao cấp, xa xỉ như Channel, Gucci,... bán giá cao hơn so với đối
thủ để nâng cao giá trị sp của mình.

Loss leader pricing: Định giá lỗ

Vd: Cây cạo râu được định giá lỗ nhưng lưỡi dao cạo sẽ bù lỗ.
Vd: Máy in được định giá lỗ nhưng mực in sẽ bù lại lỗ.

Differenciation pricing: Định giá nhiều mức

Vd: Vé máy bay phân loại thành hạng nhất, hạng thương gia, hạng phổ thông,...
Bait pricing: Định giá nhử mồi => khám phá thử thị trường chấp nhận sp của mình ntn

Bundle pricing: Định giá theo gói

Vd: Bán hàng có tặng kèm (thật ra hàng tặng kèm đã đc tính trong giá bán).

Price skimming: Định giá hớt váng

Vd: Các thiết bị điện tử như đt, vi tính đời mới sẽ có giá rất cao nhưng sau thời gian
giá của nó sẽ giảm dần.
There are 3 main branches of accounting:
 Financial accounting.
 Management accounting = Managerial accounting = Cost management.
 Cost accounting.
A. Exist in the short-run only
$

y=b

UNIT
S

2,000

HOUR
20 S
Advantages of Marginal Cost Pricing
Earn additional profits - A company can earn additional profits by attracting
extremely price-sensitive customers with occasional offerings of low prices.

Increase market penetration - Marginal cost pricing can be used to initially gain entry
into a new market by attracting new price-conscious buyers.

Increase accessory sales - In some cases, a company can sell a product with a
lower price from marginal costing but still earn more profits by selling related products
that have higher profit margins to the consumer.

Eliminate excess capacity or inventory - Marginal cost pricing is useful to move

excess inventory or capacity quickly.

Smooth fluctuations in demand - If demand slows down, a company can temporarily

reduce prices to attract bargain hunters.

Stay price-competitive in the short-term - Marginal cost pricing is a valuable tool to

use when competitors lower their prices in an attempt to gain market share.

Disadvantages of Marginal Cost Pricing

Ignores current market prices - Marginal cost pricing does not consider prevailing
market prices. It is strictly based on variable costs.

Does not build customer loyalty - Customers who take advantage of marginal cost
prices are usually price-sensitive and will not become loyal, long-term purchasers.

Not sustainable for the long-term - At some point, the company will have to sell
enough product at sufficient price points to cover fixed expenses and produce a profit.

Could be difficult to raise prices later - Consumers can come to expect lower prices
and resist raising prices at a later date.

May shift higher-paying customers - Customers who are used to paying normal
prices may shift to the discounted price market and become reluctant to return to
regular prices. Price markets should be separated to prevent this from happening.

A marginal cost pricing strategy is an effective tool when used in the short-term. It
can help a company maintain its marketing position but sacrifices profit and will not be
effective in the long-term.