In Relation to Target Costing, Which of the Following Best

question 171

Multiple Choice

In relation to target costing, which of the following best describes target cost per unit?

• A) It is the targeted cost of producing one unit to achieve the current year's budgeted profit.
• B) It is the estimated long-run cost of a product that enables the company to achieve its target operating income.
• C) It is the cost that can be achieved by ensuring that the company produced its products at maximum efficiency.
• D) It is the budgeted cost that the company estimates in producing a unit in the current budget period.

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Definitions:

Measure Of Liquidity

Indicators that demonstrate a company's ability to cover its short-term obligations with its liquid assets.

Debt-Equity Ratio

A gauge of how much a corporation leans on debt, by dividing all owed sums by the total equity of its stockholders.

Inventory Turnover

A financial ratio that shows how many times a company's inventory is sold and replaced over a period.

Mode

The most recurrent value in a data set.