Among the most important uses of managerial accounting data are establishing price for a particular product...

Among the most important uses of managerial accounting data are establishing price for a particular product or service. This is how we earn revenue. In many situations, there are external factors that impact the price that is set. This in turns impacts the organization’s bottom line. It is important that a healthcare manager has a solid understanding of pricing strategies. Identify and discuss the pricing strategies available to a healthcare manager. Be sure to discuss what it is; how it is used; and the advantages/disadvantages of each one.

Expert Solution

Pricing strategies available to healthcare manager are:

1. Cost plus pricing = full cost + profit margin

This is traditional pricing strategy for manufacturing industry .

Advantage : it ensures recovery of profit from initial stage of product lifecycle

Disadvantage : it ignores competition and customers buying power.

2. Skimming Pricing : it refers to charging high price at the introductory stage of the product. It is usually used when product is innovative and new in the market

Advantage : it ensures recovery of heavy investment made by the organization at the initial stage.

Disadvantage : there can be huge loss of market share as soon as competition enters the market

3. Going rate pricing / competitive pricing : it is method where firm tries to keep it's price at average level charged by the industry.

Advantages: a. useful where it is difficult to measure the price .

b. Yieids fair return to all firms in the industry

Disadvantage : a. Firm has very little choice about the pricing policy.

b. Firm that charges above going rate price usually unable to attract customers.

jeff jeffy answered 6 months ago

Why is it important to identify the most appropriate cost drivers for a particular product? A)...

Why is it important to identify the most appropriate cost drivers for a particular product? A) so managers can identify the activities necessary to manufacture a product B) so managers can control product costs better C) so managers can predict product costs better and make better decisions D) B and C Answer: Cost drivers are ________. A) the different functions in the value chain B) different types of functional areas in the firm C) measures of activities that require the...

One aspect of managerial accounting focuses on calculating a manufacturer's product costs as data inputs for...

One aspect of managerial accounting focuses on calculating a manufacturer's product costs as data inputs for the firm's external financial statements. For example, the manufacturer's income statement must report the actual cost of the products sold, and its balance sheet must report the actual costs in its ending inventories. The managerial accounting costs needed to support these calculations include direct labor, direct materials, non-direct materials, job order costing, process costing, allocation of manufacturing overhead (utilities and real estate taxes), and...

Gross Domestic Product, as you have read, is generally among the most important measures of an...

Gross Domestic Product, as you have read, is generally among the most important measures of an economy's health, and by extension, a country's well-being of its citizens/residents. In this week's discussion, you may take the positions to assert, explain, and defend: "GDP, given all its shortcomings (as described in the textbook), misses too many vital aspects of a society's well-being. Following is a list of other (more?) important considerations when assessing the well-being of a society's citizens/residents..."

1. Why is managerial accounting important? 2. How can you use managerial accounting in real world/life?...

1. Why is managerial accounting important? 2. How can you use managerial accounting in real world/life? (can be opinion based)

______________________________________________________________ is one of the most important international organizations to date, establishing the 1980 Convention on...

______________________________________________________________ is one of the most important international organizations to date, establishing the 1980 Convention on Contracts for the International Sale of Goods (CISG), which will be discussed further in the next section. The United Nations Commission International Trade Law The UN Security Council The UN General Assembly The UN _____________________________ is a regional international organization that includes many countries in Europe. It was established to create peace across the region and promote economic, social, and cultural development (Cheeseman, 2016,...

Provide an example of how your organization uses managerial accounting. Discuss why this application of managerial...

Provide an example of how your organization uses managerial accounting. Discuss why this application of managerial accounting contributes the organization's success

How does product costing used in financial accounting differ from product costing used in managerial accounting?

Why is CVP analysis useful? Why is it an important concept in managerial accounting?

Explain the major differences between Financial and Managerial accounting? Is one type of accounting more important...

Explain the major differences between Financial and Managerial accounting? Is one type of accounting more important than the other? Explain. For each of the following costs in a rollerblades manufacturing plant, state whether it would be considered: (1) a period cost or a product cost; and (2) if it’s a product cost, then state whether it would be classified as: direct materials, direct labor or manufacturing overhead Example: Salaries of janitors in the factory Answer: Product cost; mfg overhead a. Wheels...

Why is accounting important? Who governs accounting? How consistent is accounting among companies in the same...

Why is accounting important? Who governs accounting? How consistent is accounting among companies in the same industry? Can you show an example of where accounting rules may be applied differently and yet consistent with GAAP? Why do we care as a society about accounting rules? Show by way of example, what happens when a company does not follow legitimate accounting practices. Explain the value of financial ratios and why they are important? How are they used by companies, by investors,...

Question