Management Accounting

984 WordsJul 4, 20104 Pages
[pic] Management Accounting Submitted to: Dr. James Tong MBA 507: Management Accounting Submitted by: Rajvinder Brar Student Id-0910183 Definition – Historical cost In accounting, historical cost is the original financial or monetary value of any economic item. It is based on a stable measuring assumption of a unit. Sometimes under some circumstances, assets and liabilities on a balance sheet can be shown at their historical or the original value at the time of purchase can be shown, as if there has been no change since it has been bought until after sometime.…show more content…
But they are however too likely to focus on the costs when they take part in appropriate price strategies. Marketing experts focus on a group of customers i.e. the certain market segment and their own needs considering each as possible target market. The company then will decide which segment to target with different product and marketing mix. Each of these approaches will be highly important in pricing. We can take an example of a restaurant, which has different number of customers coming in at different hours of the day. Now the customers coming in at the peak hours are too many and it creates problem for the restaurant staff and the place available . The owner will hire extra staff and furniture to solve the problem but his cost in expenditures will go up. To make the restaurant profitable and to serve the customers better he takes all these actions and make them feel special by providing extra facilities to the customers. But at the same time he has made a point that these expenditures will be born by the customers to get those extra waiters and furniture for them. This way the customers are informed about this and the owner gets the money back in form of profit . groups of customers, each with their own needs, and considering each as a possible target market. The firm will then decide which segments to target and will provide the selected

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