A target cost is computed as:
A) cost to manufacture plus a desired markup.
B) cost to manufacture plus designated selling expenses.
C) market willingness to pay - cost to manufacture.
D) market willingness to pay - desired profit.

Question

Quizplus · Accepted Answer

A target cost is determined by subtracting the desired profit from the market willingness to pay, ensuring the product can be produced at a cost that allows for the desired profit margin.

A Target Cost Is Computed As