Galla Inc.operates in a highly competitive market where the market price for its product is $170 per unit.Galla desires a $15 profit per unit.Galla expects to sell 5,000 units.Additional information is as follows: $$\begin{array}{l}
\begin{array} { l l r }
\text { Variable product cost per unit}&\$15\
\text { Variable administrative cost per unit}&10\
\text { Total fixed overhead}&45,000\
\text { Total fixed administrative}&18,000
\end{array}
\end{array}$$ Using target costing,what is the target cost?
A)$135.00
B)$160.00
C)$130.00
D)$145.00
E)$155.00

Question

Galla Inc.operates in a highly competitive market where the market price for its product is $170 per unit.Galla desires a $15 profit per unit.Galla expects to sell 5,000 units.Additional information is as follows: $$\begin{array}{l}
\begin{array} { l  l r } 
\text { Variable product cost per unit}&\$15\
\text { Variable administrative cost per unit}&10\
\text { Total fixed overhead}&45,000\
\text { Total fixed administrative}&18,000
\end{array}
\end{array}$$ Using target costing,what is the target cost?
A)$135.00
B)$160.00
C)$130.00
D)$145.00
E)$155.00

Quizplus · Accepted Answer

The Answer of Galla Inc.operates in a highly competitive market where the market price for its product is $170 per unit.Galla desires a $15 profit per unit.Galla expects to sell 5,000 units.Additional information is as follows: $$\begin{array}{l}
\begin{array} { l  l r } 
\text { Variable product cost per unit}&\$15\
\text { Variable administrative cost per unit}&10\
\text { Total fixed overhead}&45,000\
\text { Total fixed administrative}&18,000
\end{array}
\end{array}$$ Using target costing,what is the target cost?
A)$135.00
B)$160.00
C)$130.00
D)$145.00
E)$155.00

Galla IncOperates in a Highly Competitive Market Where the Market Price