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Brittney Javelin Company is considering introducing a new spear fishing product during 2019. The company plans to use target costing to manage the product development process. 7. n market research, the Company concluded that it can generate sufficient demand for the new y that all new Based o product at a maximum price of $45 per unit to justify its introduction. It is standard polic products must generate a minimum profit margin of 30% after considering all costs to produce, market, and deliver the products. The product design team developed the following estimates of the costs required to produce and sell the new spear fishing product: Direct Manufacturing Costs Indirect Manufacturing Costs Packaging Costs Marketing and Promotion Sales Commissions Distribution Costs $15.25 $7.40 $0.65 $1.25 4% of Sales $1.50 Your Answer Determine the target cost that must be established for the new spear fishing product. (3 points) Supporting Computation Required Your Answer Determine the total estimated cost to produce and sell the new spear fishing product as determined by the product design team. (4 points) Supporting Computation Required: b. Your Answer Would Brittney Javelin Company accept or reject the design of the spear fishing product as determined by the product design team? (3 points) Brief Explanation Required: c. S Which of the following statements best reflects the nature of the relationship of fraud risk factors to the existence of financial statement fraud perpetuated by a company's management? (2 points) A. The existence of at least one fraud risk factor indicates that a financial statement fraud has definitely occurred The lack of existence of at least one fraud risk factor indicates that a financial statement fraud has definitely not occurred. The existence of at least one fraud risk factor indicates that there is higher risk that a financial statement fraud has occurred. The existence of at least one fraud risk factor has no bearing on whether or not a financial statement fraud has occurred. B. C. D

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