A Target Cost Is Computed as

question 23

Multiple Choice

A target cost is computed as

• A)the cost to manufacture plus a desired mark up.
• B)the cost to manufacture plus the designated selling expenses.
• C)the market willingness to pay less the cost to manufacture.
• D)the market willingness to pay less the desired profit.

---

Definitions:

Building Expenses

Costs associated with the maintenance, repair, and running of a building.

Allocation Base

A criterion or measure used for distributing costs or expenses across different departments or products.

Building Depreciation

The systematic allocation of the cost of a building over its useful life to account for the decrease in its value over time.

Square Feet

A measurement unit for area, commonly used in real estate, equal to the area of a square with sides of one foot.