Discourse Stationery Company Is a Price-Taker and Uses Target Pricing

question 47

Multiple Choice

Discourse Stationery Company is a price-taker and uses target pricing.The company has completed an analysis of its revenues,costs,and desired profits and has calculated its target full product cost.Refer to the following information:

Actual costs are currently higher than target full product cost.Assume all products produced are sold.Assuming that variable costs are dependent on commodity prices and cannot be reduced,what is the target fixed cost?

• A)$230,000
• B)$420,000
• C)$80,000
• D)$500,000

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Definitions:

LH

Luteinizing Hormone, a hormone that triggers ovulation in females and testosterone production in males.

ACTH

Adrenocorticotropic hormone, a pituitary gland hormone that stimulates the production of cortisol by the adrenal cortex.

Uterine Cycle

The monthly cycle of changes in the uterus, including menstruation and the development of the endometrium, in preparation for possible pregnancy.

Mons Pubis

A rounded mound of fatty tissue situated over the pubic bone of females, becoming more prominent after puberty.