What Is the Basic Premise of Target Costing

question 31

Multiple Choice

What is the basic premise of target costing?

• A)Products should be designed to meet customer needs at a price customers are willing to pay that allows the company to make a reasonable profit.
• B)Products should be designed at the least cost possible to enable the lowest price in the market.
• C)Products should be designed based on features that competitors' products include to enhance the company's ability to compete more effectively.
• D)The price with the highest profit should always be selected.

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Definitions:

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