Determinant company is a price − taker and uses a target − pricing approach. refer to the following information: production volume 600,000 units per year market price $34 per unit desired operating income 15% of total assets total assets $13,900,000 what is the target full product cost in total for the year? assume all units produced are sold.

$18,315,000

Explanation:

Total Income :

= 15% of Total assets

= $13,900,000 × 15%

= $2,085,000

Total Sales :

= Market price × Production volume

= $34 × 600,000

= $20,400,000

So, Target full product cost in total for the year :

=  Total Sales - Total Income

= $20,400,000 - $2,085,000

= $18,315,000

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