Intermediate management accounting

Pricing and Intra Company Transfers

This lecture we will be focusing on pricing, costing being a part of it. We will be discussing major factors that affect the pricing decisions and long term and short term decision making. We will also be discussing the different pricing strategies.

Comparing the costs for service and manufacturing sectors and coming up with way to allocate the costs for service sector.

Calculating the activity based cost, its limitations and time driven activity based costing.

The notes cover the different methods of allocating the indirect costs. The departmental basis of allocation has been explained in great detail including the step down method and the reciprocal method.

Introduction to cost allocation - why is it needed and the different ways by which it can be done.