Askew enterprises produces a product with fixed costs of $200,000 and variable cost of $9 per unit. the company desires to earn a $100,000 profit and believes it can sell 20,000 units of the product.
requiredbased on this information, determine the target sales price. assume a competitor is currently selling a similar product for $20 per unit. explain how askew can use target costing to maintain its desired profitability

Which of the following is a function performed by market prices? a. market prices communicate information to buyers and sellers. b. market prices coordinate the decisions of buyers and sellers. c. market prices motivate entrepreneurs to produce those products that are currently most desired relative to their costs of production. d. all of the above are functions performed by market prices.

Which of the following is the best example of substitution? a. movie producers begin making more comedies because they cost less to make than action films. b. people walk out before the end of a movie because the acting and the plot are terrible. c. people at the movie theater switch from popcorn to candy because popcorn has gotten too expensive. d. more people begin going to matinee movies instead of night movies to save money on the tickets.

Before setting your prices, it's wise to a. subtract your profit margin from your costs. b. research industry standards. c. memorize the formula for cost plus. d. ignore your competitors' prices.