Cassa Company Is a Price-Taker and Uses Target Pricing

question 146

Multiple Choice

Cassa Company is a price-taker and uses target pricing.Refer to the following information:

With the current cost structure,Cassa cannot achieve its profit goals.It will have to reduce either the fixed costs or the variable costs.Assuming that fixed costs cannot be reduced,what are the target variable costs per year? Assume all units produced are sold.

• A)$11,547,000
• B)$12,020,000
• C)$5,600,000
• D)$17,147,000

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