Target costing starts with an ideal selling price based on customer value considerations and then aims at costs that will ensure that the price is met.

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Target costing is a cost management approach that begins with identifying the customer's needs and expectations, determining the ideal selling price based on them, and then working backward to achieve that price while ensuring a reasonable profit margin. This process involves setting a target cost for the product or service based on the desired selling price, and then finding ways to reduce costs through value engineering and other cost-saving techniques. Therefore, the statement that target costing starts with an ideal selling price and aims at costs that will ensure that the price is met is true.

Target Costing Starts with an Ideal Selling Price Based on Customer