The Desired ROI Per Unit Is Calculated by

question 52

Multiple Choice

The desired ROI per unit is calculated by

• A) multiplying the ROI by the investment and dividing by the estimated volume.
• B) multiplying the unit selling price by the ROI.
• C) dividing the total cost by the estimated volume and multiplying by the ROI.
• D) dividing the ROI by the estimated volume and subtracting the result from the unit cost.

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Definitions:

Relevant Range

The range of activity within which assumptions about the behavior of costs are valid.

Direct Costs

Costs that can be directly attributing to the production of specific goods or services, such as raw materials and labor.

Merchandising Company

A type of business that purchases goods in a ready-to-sell condition and earns income by selling these goods to end consumers.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold in a company, including materials and labor.