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An analisys of Management Accounting - Essay Example
The researcher of this report demonstrates the critical assessment of the models and various ideas proposed outlining their qualities and limitations. Application of this will helps the company to meeting its budgeted target profits…
This research aims to evaluate and present the models and concepts affecting the pricing decisions taken by organizations, critically reflecting upon their usefulness. The price variable is the one of the significant ingredients in marketing mix of the organization. Price itself can effectively communicate with the consumers regarding the product or service. So, “when the pricing decision is made, the organization must consider several factors. These factors” such factor includes, Regulation of government, Perceptions in the market, supply, desired pricing position of the organization, demand and finally Competitors and Competition pricing policies. The final price of any product or service is influenced by various factors; these can be summarized into two that are internal and external factors. Internal Factors – Internal factors are those which are controllable by the organization and also, if required, it can be altered. Although, the company may have control over these internal factors creating a quick alteration is not always practical or realistic. For example, pricing of the product may depend closely on the efficiency of a manufacturing capability (e.g., how much can be manufactured in a certain time). External Factors - There are a numeral of influencing factors which are not restricted to the organization but will influence pricing decisions. The marketer needs to identify these factors to carry out various researches to observe what is happening in every marketplace that the organization serves, since result of these factors can change by marketplace.