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

question 16

Multiple Choice

Revolve Company is a price-taker and uses a target-pricing approach.Refer to the following information: $$\begin{array} { | l | c | l|} \hline \text { Production volume } & 602,000& \text { units per year } \\\hline \text { Market price } & \$ 32 &\text { per unit } \\\hline \text { Desired operating income } & 15 \% &\text { of total assets } \\\hline \text { Total assets } & \$ 13,700,000 \\\hline\end{array}$$ What is the target full product cost in total for the year? Assume all units produced are sold.

• A)$90,300
• B)$17,209,000
• C)$13,700,000
• D)$2,055,000

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Definitions:

Circular Smooth Muscle

Smooth muscle fibers arranged in circular bands in various organs, such as the intestines, aiding in the constriction and movement of content.

Longitudinal Smooth Muscle

Muscle fibers arranged parallel to the long axis of an organ, contributing to its contraction and relaxation, found in the walls of internal organs.

Muscularis

Muscular coat of a hollow organ or tubular structure.

Peristalsis

The rhythmic contractions of smooth muscles in the gastrointestinal tract that facilitate the movement of food and waste.