charleston affair currently sells 1,000 units of product z for $64.50 and expects the price...
70.2K
Verified Solution
Link Copied!
Question
Accounting
charleston affair currently sells 1,000 units of product z for $64.50 and expects the price to rise by 12% in the upcoming year. The balance sheet shows total assets of $200,000, & management has set a required rate of return of 15% on the assets. Use the target method to determine the total target cost the company should achieve.
Selling Price=$72.24 ($64.50 x 1.12) ***Where do they get 1.12?
Desired Profit=$30,000 ($200,000 x 15%)
Target Cost=$42,240 ($72.24 x 1,000 units) - $30,000
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
