Rica Company Is a Price-Taker and Uses Target Pricing

question 69

Multiple Choice

Rica Company is a price-taker and uses target pricing. Refer to the following information: With the current cost structure, Rica cannot achieve its profit goals. It will have to reduce either the fixed costs or the variable costs. Assuming that fixed costs cannot be reduced, how much will be the target variable costs per unit per year? (Round your answer to the nearest cent.)

• A)$26.53
• B)$9.33
• C)$17.19
• D)$18

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Definitions:

Roller Bearings

Bearings that use cylindrical or spherical rollers positioned between two races to reduce friction and support radial and axial loads.

Needle Bearings

A type of roller bearing with long, thin cylindrical rollers resembling needles, used in applications with limited space and high load capacity.

Journal Bearings

Journal bearings are a type of plain bearing that support radial loads by enclosing the shaft along its length, offering a smooth, lubricated surface for the shaft to rotate within.

Sleeve Bearings

Bearings consisting of a cylindrically shaped liner that allows for relative motion by sliding, used in various machinery for rotational or sliding movements.