Which Statement Best Describes Target Costing

question 41

Multiple Choice

Which statement best describes target costing?

• A) Target costs are internally driven.
• B) The principal challenge of target costing is finding the cause of the costs.
• C) It is a useful tool for establishing cost reduction goals for products in the design stage.
• D) It is the difference between the sales price needed to capture a predetermined market share and the desired per-unit gross profit.

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Definitions:

Empirical Data

Information gathered through observation or experimentation that can be analyzed to gain knowledge.

External Forces

Factors outside of an individual's or organization's control that affect their decisions or operations.

Scientific Theories

Thoroughly validated interpretations of particular facets of the natural world, grounded in an evidential base that has been consistently reaffirmed through both empirical observation and experimental procedures.