what is full cost pricing
See Fig. 77 . A key element in full-cost pricing is the estimate of sales volume that is necessary to calculate average fixed cost and required unit contribution, although inevitably the price charged will itself affect sales volume. The full-cost pricing method is also called AVERAGE-COST PRICING. Although this pricing method is based upon costs, in practice managers take into account demand and competition by varying the target profit markup over time and between products.