Wenner Corporation Would Like to Use Target Costing for a New

question 43

Multiple Choice

Wenner Corporation would like to use target costing for a new product it is considering introducing. At a selling price of $44 per unit, management projects sales of 10,000 units. The new product would require an investment of $900,000. The desired return on investment is 10%.
-The desired profit according to the target costing calculations is:

• A) $696,000
• B) $24,000
• C) $86,400
• D) $720,000