Difference between cost and market based transfer price
Answers
Answered by
0
Comparison between Price and Cost:
Price
Cost
Definition
The term ‘price’ is defined as the amount that the customers pay for a product.
The term ‘cost’ is defined as the amount spent by a business in making a product.
Product
It is amount of money given to buy a product.
It is the amount of money used to produce a product.
Implication
It implies the future acquisitions of the buyers.
It is the money spent in mainting the product.
Money used
Here, the money is used to gain something.
Here, the money is used in the production process of labor, capital, materials, wages, bills, and other transaction costs.
Value determined by
The ‘price’ is determined by adding the production costs and seller’s profit.
It is said to be a component of the price.
Value
The value is higher as compared to cost.
The value is lower as compared to price.
Demand
It is demanded from consumers.
It is demanded from sellers.
Price
Cost
Definition
The term ‘price’ is defined as the amount that the customers pay for a product.
The term ‘cost’ is defined as the amount spent by a business in making a product.
Product
It is amount of money given to buy a product.
It is the amount of money used to produce a product.
Implication
It implies the future acquisitions of the buyers.
It is the money spent in mainting the product.
Money used
Here, the money is used to gain something.
Here, the money is used in the production process of labor, capital, materials, wages, bills, and other transaction costs.
Value determined by
The ‘price’ is determined by adding the production costs and seller’s profit.
It is said to be a component of the price.
Value
The value is higher as compared to cost.
The value is lower as compared to price.
Demand
It is demanded from consumers.
It is demanded from sellers.
Similar questions