Launch Company Sells 2500 Paddleboards Per Year at a Sales

question 173

Multiple Choice

Launch Company sells 2500 paddleboards per year at a sales price of $470 per unit.Launch sells in a highly competitive market and uses target pricing.The company has $800,000 of assets,and the shareholders wish to make a profit of 16% on assets.Variable cost is $190 per unit and cannot be reduced.Assume all products produced are sold.What are the target fixed costs?

• A) $1,175,000
• B) $1,047,000
• C) $128,000
• D) $572,000

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Definitions:

Retail Store

A business establishment that sells goods or services directly to the public, typically from a fixed location or online platform.

Production Possibilities Curve

A graphical representation illustrating the maximum output possibilities for two goods, given a set of inputs and technological efficiency.

Government Policy

Guidelines or rules established by governments to direct public action in specific areas such as health, education, and economic management.

Consumer Goods

Products and services that are used by individuals or households to satisfy their immediate wants and needs.