Gotham Products Is a Price-Taker and Uses Target Pricing How Much Is the Target Full Product Cost Per Year

question 8

Multiple Choice

Gotham Products is a price-taker and uses target pricing.Please refer to the following information:
$$\begin{array} { | l | l | l | } \hline \text { Production volume } & \$ 602,000 & \text { units per year } \\\hline \text { Market price } & \$ 34 & \text { per unit } \\\hline \text { Desired operating profit } & 17 \% & \text { of total assets } \\\hline \text { Total assets } & \$ 1,800,000 & \\\hline\end{array}$$
How much is the target full product cost per year? Assume all units produced are sold.

• A) $10,836,000
• B) $20,468,000
• C) $30,600,000
• D) $20,162,000

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