I am trying to get my own(paid) website. But I am not sure about what steps I should take. I understand that signing up with a hosting company will get me storage and scripting functionalities. But I don't understand the process of getting a domain name of my choice. Can I sign up with one hosting company and then buy a domain name from a different company? I can't figure out why different companies charge different prices for the same domain name. Thanks in advance.

Yes you can buy a domain name from different company than your hosting company.

I highly recommend researching this topic before securing a domain name.

First of all, if you go to certain domain name search engines, you're likely to end up having to purchase that domain name from a company you don't prefer at a possibly unreasonable price. Whatever you do, resist the urge to search for available domain names until you know you are ready to purchase and build. Try to buy the domain from your preferred hosting company.

If you are going to build your own website and you have zero experience, I'd recommend yahoo as a good place to start and learn. Other folks might disagree, but there are some benefits to hosting a new site with a giant search engine company. Plus, they have some easy-to-use commerce features.

If you have web design experience, search for the best deal on hosting and purchase your domain from the same company. You don't have to, but it's fewer headaches. The company I use quite often costs $45 for domain name and 1 year hosting and comes with 20GB monthly bandwidth, plenty of storage, unlimited email addresses, and so on. Subsequent years are $6/mo/yr. There are many good companies from which to choose; just look around.

Finally, if you are going to have your website built by an agency, you might as well just buy your domain through them. If you pre-purchase from somewhere else you will probably pay a fee to transfer the domain to their servers anyway. Either way, you're gonna pay. Besides, they might have some suggestions for branding your website with a catchy domain name.

Hope this helps a little.

Godaddy and directnNIC are selling domain names in very reasonable price. They are providing good services as well.

You don't need to worry about web hosting cost. Some companies are providing free PHP and MySQL web hosting like this one. I am also using this free web hosting.

So you just have to pay $9/$10 for your domain name and then host your site with free web hosting company.