Determinant Company Is a Price-Taker and Uses a Target-Pricing Approach

question 178

Multiple Choice

Determinant Company is a price-taker and uses a target-pricing approach. Refer to the following information: $$\begin{array} { | l | r | l | } \hline \text { Production volume } & 600,000 & \text { units per year } \\\hline \text { Market price } & \$ 30 & \text { per unit } \\\hline \text { Desired operating income } & 15 \% & \text { of total assets } \\\hline \text { Total assets } & \$ 13,700,000 & \\\hline\end{array}$$ What is the target full product cost in total for the year? Assume all units produced are sold.

• A) $90,000
• B) $15,945,000
• C) $13,700,000
• D) $2,055,000

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