In retail systems, the cost price represents the specific value that represents unit price

Unit price

Average prices represent, quite simply, total sales revenue divided by total units sold. Many products, however, are sold in multiple variants, such as bottle sizes. In these cases, managers face a challenge: they must determine “comparable” units. Average prices can be calculated by weighting...

 purchased. This value is used as a key factor in determining profitability

Profit (accounting)

In accounting, profit can be considered to be the difference between the purchase price and the costs of bringing to market whatever it is that is accounted as an enterprise in terms of the component costs of delivered goods and/or services and any operating or other expenses.-Definition:There are...

 and in some stock market theories it is used in establishing the value of stock holding.

Forms

Cost prices appear in several forms, such as Actual Cost, Last Cost, Average Cost and Net realizable value.

Cost Price

cost price is also known as c p
it is the original price of any item who bought it
Cost price is used in establishing profitability in the following ways:

• Selling price (Excl. Tax) less cost results in the profit
  Profit (accounting)
  In accounting, profit can be considered to be the difference between the purchase price and the costs of bringing to market whatever it is that is accounted as an enterprise in terms of the component costs of delivered goods and/or services and any operating or other expenses.-Definition:There are...
  
   in money terms.
• Profit / selling price (Excl. Tax) when expressesd as a percentage produces (Gross Profit
  Gross profit
  In accounting, gross profit or sales profit is the difference between revenue and the cost of making a product or providing a service, before deducting overhead, payroll, taxation, and interest payments...
  
  ) or GP%
• Expense
  Expense
  In common usage, an expense or expenditure is an outflow of money to another person or group to pay for an item or service, or for a category of costs. For a tenant, rent is an expense. For students or parents, tuition is an expense. Buying food, clothing, furniture or an automobile is often...
  
   / Net Sales yields a percentage which when used as the target margin will produce gross profit
  Gross profit
  In accounting, gross profit or sales profit is the difference between revenue and the cost of making a product or providing a service, before deducting overhead, payroll, taxation, and interest payments...
  
  .

Actual Cost

Actual Cost or Landed Cost
In this calculation all expenses in acquiring an item are added to the cost of items to establish what the goods actually cost. Additions usually include freight, duty etc..

Cost

This is the actual value

Value (economics)

An economic value is the worth of a good or service as determined by the market.The economic value of a good or service has puzzled economists since the beginning of the discipline. First, economists tried to estimate the value of a good to an individual alone, and extend that definition to goods...

 of the item

Item

- Organizations :* ITeM, refers to the Uruguay-based Third World Institute , going by its Spanish acronym Instituto del Tercer Mundo* ITEM club, an economic forecasting group based in the United Kingdom- Newspapers :...

 when last purchased. Normally expressed in units.

Average Cost

When new stock

Stock

The capital stock of a business entity represents the original capital paid into or invested in the business by its founders. It serves as a security for the creditors of a business since it cannot be withdrawn to the detriment of the creditors...

 is combined with old stock, the new price

Price

-Definition:In ordinary usage, price is the quantity of payment or compensation given by one party to another in return for goods or services.In modern economies, prices are generally expressed in units of some form of currency...

 often overstates the value of stock holding. The better method is to combine the total value of investment

Investment

Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...

 in stock, old and new and divide by the total number of units to calculate the average cost. This is a very accurate method of establishing stock holding.

Moving Average Cost

Moving average cost. (MAC)
A slight permutation

Permutation

In mathematics, the notion of permutation is used with several slightly different meanings, all related to the act of permuting objects or values. Informally, a permutation of a set of objects is an arrangement of those objects into a particular order...

 on the above, with the average being calculated from the previous average and new price.

Net Realizable Value

Normally indicates the average value of an item in the marketplace

Marketplace

A marketplace is the space, actual, virtual or metaphorical, in which a market operates. The term is also used in a trademark law context to denote the actual consumer environment, ie. the 'real world' in which products and services are provided and consumed.-Marketplaces and street markets:A...

. Often this cost is interchangeable with replacement cost.