Mays Tools Believes It Can Sell 80,000 of Its Proposed

question 98

Multiple Choice

Mays Tools believes it can sell 80,000 of its proposed new Dirt Dodgers at a price of $50 each.If the company desires to make a profit of 60% of selling price, what is the target variable cost per Dirt Dodger?

• A)$25.00
• B)$30.00
• C)$31.25
• D)There is not enough information provided to determine the answer.

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Definitions:

Finished Products

Items or goods that have completed all stages of production and are ready for sale to customers.

Time Period

A specific duration or interval during which certain events occur or conditions are measured.

Selling and Administrative Expenses

Expenses related to the daily operations of a business that are not directly tied to production, including sales promotions, salaries of administrative staff, and office rent.

Days' Sales

A measure often used in the context of 'Days' Sales in Inventory' which indicates the average number of days it takes for a company to sell its inventory.