Philadelphia Swim Club Is Planning for the Coming Year

Philadelphia Swim Club is planning for the coming year.Investors would like to earn a 10% return on the company's $30 million of assets.The company primarily incurs fixed costs to maintain the swimming pool.Fixed costs are projected to be $12,500,000 for the year.About 500,000 members are expected to swim each year.Variable costs are about $10 per swimmer.The Philadelphia Swim Club has a favorable reputation in the area and therefore,has some control over the membership price.Using a cost-plus approach,what price should Philadelphia Swim Club charge for a membership?

A) $41.00
B) $37.50
C) $29.00
D) $ 0.17