Elio Corporation Would Like to Use Target Costing for a New

question 56

Essay

Elio Corporation would like to use target costing for a new product that is under consideration. At a selling price of $84 per unit, management projects sales of 40,000 units. The new product would require an investment of $400,000. The desired return on investment is 11%.
Required:
Determine the target cost per unit for the new product.

---

Definitions:

Priority Problem

An issue identified as having significant importance or urgency, requiring immediate attention or action to prevent or address serious outcomes.

Bradypnea

A slower than normal breathing rate, which might indicate a respiratory or brain condition, requiring further medical examination.

Swollen Nodes

Enlarged lymph nodes often indicating an infection or sometimes, more serious conditions such as cancer.