Target Costing: Definition, Formula & Example


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question 1 of 3

If you were designing a smartphone with a target price of $500, which would be UNLIKELY to make an appearance in the finished product?

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1. What is the point around which all else is planned in target costing?

2. Which of these is most likely to experience target costing?

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About This Quiz & Worksheet

Measure what you know about target costing with this quiz and worksheet. These practice questions will help you gauge your understanding of the purpose and steps in this process.

Quiz & Worksheet Goals

Completing this quiz will help you determine what you know about:

  • Products likely to go through target costing
  • Ideas that are rejected during target costing
  • Target costing steps

Skills Practiced

You can count on this quiz and worksheet to give you the opportunity to practice skills such as:

  • Reading comprehension - ensure that you draw the most important information from the related lesson on target costing
  • Interpreting information - verify that you can read information regarding items that might be included in a phone and interpret it correctly
  • Information recall - access the knowledge you've gained regarding the detail in price costing that everything is planned around

Additional Information

Continue educating yourself about this subject with the lesson titled Target Costing: Definition, Formula & Example. You can use this lesson to strengthen your understanding of:

  • Why some prices never seem to change
  • Each step in the target costing process
  • A real world example of target costing