Galla IncOperates in a Highly Competitive Market Where the Market Price

question 90

Multiple Choice

Galla Inc.operates in a highly competitive market where the market price for its product is $170 per unit.Galla desires a $15 profit per unit.Galla expects to sell 5,000 units.Additional information is as follows: $$\begin{array}{l}\begin{array} { l l r } \text { Variable product cost per unit}&\$15\\\text { Variable administrative cost per unit}&10\\\text { Total fixed overhead}&45,000\\\text { Total fixed administrative}&18,000\end{array}\end{array}$$ Using target costing,what is the target cost?

• A)$135.00
• B)$160.00
• C)$130.00
• D)$145.00
• E)$155.00

Understand the concept of inventory shrinkage and its implications on inventory management.

Grasp the principles of selling and administrative expenses and their placement in the income statement.

Understand how to calculate the cost of inventory reported on the balance sheet under different conditions.

Learn how to journalize transactions for both periodic and perpetual inventory systems.

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Definitions:

Affirmative Action

Represents a set of steps taken by an organization to actively seek qualified applicants from groups underrepresented in the workforce.

Conflict

A situation where individuals or groups have opposing interests, beliefs, or needs.

Productivity

Is an economic measure of efficiency that summarizes and reflects the value of the outputs created by an individual, organization, industry, or economic system relative to the value of the inputs used to create them.

Ethnocentrism

The act of judging another culture solely by the values and standards of one's own culture.