Pueblo Products Is a Price-Taker and Uses Target Pricing

question 126

Multiple Choice

Pueblo Products is a price-taker and uses target pricing. Pueblo has just done an analysis of their revenues, costs and desired profits, and has calculated its target full cost. Please refer to the following information: Actual costs are currently higher than target full cost. Assuming that fixed costs are predominantly related to depreciation expense and CANNOT be reduced, how much is the target variable cost per unit?

• A)$0.92
• B)$1.04
• C)$1.00
• D)$0.96

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Definitions:

Supererogatory Actions

Actions that go beyond what is morally required or expected, typically considered voluntary and commendable but not obligatory.

Kant's Categorical Imperatives

Fundamental principles in Immanuel Kant's ethical theory that command us to act in a universally acceptable way, independent of our desires.

Act Consequentialists

Adherents of a branch of consequentialism that assesses each action by the goodness of its consequences, without reliance on general rules.

Obedience to Rules

The act of following directives, standards, or laws established by authorities or societies to maintain order and achieve collective goals.