Rocky River Company Is a Price-Taker and Uses Target Pricing

question 59

Multiple Choice

Rocky River Company is a price-taker and uses target pricing.Refer to the following information: $$\begin{array} { | l | l | l | } \hline \text { Production volume } & \$ 02,000 & \text { units per year } \\\hline \text { Market price } & \$ 30 & \text { per unit } \\\hline \text { Desired operating income } & 15 \% & \text { of total assets } \\\hline \text { Total assets } & \$ 13,700,000 & \\\hline\end{array}$$ What is the target full product cost per unit? (Round your answer to nearest cent.) Assume all units produced are sold.

• A) $30.00
• B) $26.59
• C) $4.50
• D) $25.50

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Definitions:

Perfect Equality

A theoretical state in which all individuals have the same wealth, income, or resources.

Unequal Income Distribution

The disparity in earnings among different individuals or groups in an economy, often measured by metrics like the Gini coefficient.

Equality Of Income

Describes a situation where income is distributed evenly across all members of a society, minimizing the gap between the highest and lowest earners.

Incentive

A motive or condition that encourages or motivates individuals or organizations to act in a certain way.