ACC 201 New Product Pricing Decisions (INDIANA)

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ACC 201 New Product Pricing Decisions (INDIANA)

ACC 201 New Product Pricing Decisions (INDIANA)

Introduction and Alignment

 

In this discussion forum, you will have the opportunity to consider the many factors that may be important in pricing a new product.  The pricing of a new product, such as a next-generation iPad, draws together many of the topics covered in the course to date, including variable vs. fixed costs, sunk costs, break-even analysis, and short-run vs. long-run decisions.

Upon completion of this assignment, you should be able to:

Identify information that is relevant for making short-term decisions.

Make regular and special pricing decisions.

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Resources

 

Textbook: Horngren’s Accounting

Media: 5.3 Resource: Cost Systems and Business Decisions

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Instructions

 

1. In Horngren’s Accounting, review:

a. Chapter 24

b. Chapter 25

2. Review the media: 5.3 Resource: Cost Systems and Business Decisions.

3. Navigate to the threaded discussion below and respond to the following prompt:

a. When Apple introduces a new version of the iPad, many considerations go into setting the selling price.  Discuss the importance of the following in setting the initial selling price of the iPad:

i. Development costs of the new product

ii. Pricing of the previous model of the iPad

iii. Features of the iPad compared to competing products

iiii. Pricing of comparable products from competitors

v. The break-even point

vi. Variable production costs

vii. Capacity of manufacturing plants to produce the iPads

4. Your initial post is due by the end of the fourth day of the workshop.

5. Read and respond to at least two of your classmates’ postings, as well as all follow-up instructor questions directed to you, by the end of the workshop.

6. Your postings should also:

a. Be well developed by providing clear answers with evidence of critical thinking.

b. Add greater depth to the discussion by introducing new ideas.

c. Provide clarification to classmates’ questions and provide insight into the discussion.