- BTEC Nationals Business
- Unit 7: Management Accounting
- Assessment criteria covered in this activity; P1
The Bee honey Company is looking at developing a new range of honey. This range will be a premium organic honey that will have a rich, sweet taste. The board of directors at the company have asked you to produce a report to them explaining the different costs that would be involved with producing this product as well as the methods that could be used in determining the price that is charged for the product.
Contents of your Report
Your report should include the following;
- Explain what is meant by the terms; fixed costs, variable costs, semi-variable costs, direct costs and indirect costs
- Provide examples of the different costs that the business will face in producing this product
- Explain how the business could go about setting the price of the product, with worked examples where possible.