Target Costing - P2 Flashcards
1
Q
What is target costing driven by?
A
External market factors
2
Q
What is estimated first?
A
Performance characteristics and market price requirements in order for desired market share
3
Q
How do we arrive at a target cost?
A
Standard profit margin subtracted from the projected selling price
4
Q
How would development team reach target cost?
A
product and process design decisions
5
Q
What should the target profit requirement be driven by?
A
strategic profit after planning rather than a standard mark-up
6
Q
What is used to change production methods and reduce expected costs?
A
Functional analysis, value analysis and value engineering
7
Q
What analysis are customer focused?
A
Functional analysis
Value analysis
