Target return-on-sales pricing refers to
A) adjusting the price of a product so it is "in line" with that of its largest competitor.
B) setting the price of a line of products at a number of different price points.
C) adding a fixed percentage to the cost of all items in a specific product class.
D) setting prices to achieve a profit that is a specified percentage of the sales revenue.
E) setting a price based on a specific annual dollar target profit volume.

Question

Quizplus · Accepted Answer

Target return-on-sales pricing involves setting prices to achieve a profit that is a specified percentage of the sales revenue. This approach takes into account both the cost of the product and the desired profit margin, and is often used when companies have a specific profit target they want to hit. It differs from other pricing strategies, such as cost-plus pricing, which simply adds a fixed percentage to the cost of goods sold.

Target Return-On-Sales Pricing Refers to