Brislin Products has a new product going on the market next year.The following data are projections for production and sales: $$\begin{array} { l l }
\text { Variable costs } & \$ 250,000 \
\text { Fixed costs } & \$ 450,000 \
\text { ROl } & 14 \% \
\text { Investment } & \$ 2,000,000 \
\text { Sales } & 200,000 \text { units }
\end{array}$$
- What is the target selling price per unit?
A)$4.90
B)$3.50
C)$2.65
D)$3.65

Question

Brislin Products has a new product going on the market next year.The following data are projections for production and sales: $$\begin{array} { l l } 
\text { Variable costs } & \$ 250,000 \
\text { Fixed costs } & \$ 450,000 \
\text { ROl } & 14 \% \
\text { Investment } & \$ 2,000,000 \
\text { Sales } & 200,000 \text { units }
\end{array}$$
- What is the target selling price per unit?
A)$4.90
B)$3.50
C)$2.65
D)$3.65

Quizplus · Accepted Answer

The target selling price per unit is $4.90. This is calculated by dividing the total costs by the number of units sold. The total costs are $250,000 (variable costs) + $450,000 (fixed costs) = $700,000. The number of units sold is 200,000. Therefore, the target selling price per unit is $700,000 / 200,000 = $4.90.

Brislin Products Has a New Product Going on the Market