Which of the Following Lists the Steps in the Target

question 74

Multiple Choice

Which of the following lists the steps in the target costing process in the proper order?

• A)Analyze customer needs and wants, determine the desired profit, find the target cost, and design the product
• B)Design the product, analyze customer needs and wants, determine the desired profit, and find the target cost
• C)Analyze customer needs and wants, find the target cost, design the product, and determine the desired profit
• D)Analyze customer needs and wants, determine the desired profit, design the product, and find the target cost

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Definitions:

Fixed Element

A cost that does not change in total with changes in the volume of activity, remaining constant regardless of changes in levels of output or sales.

Power Costs

The expenses associated with the electricity used by a business for its operations.

Operating Departments

Units or divisions within an organization that are directly involved in its primary revenue-generating activities.

Transfer Price

The price charged for goods or services transferred among divisions or subsidiaries within the same company.