ACCOUNTING
Multiple Choice
After conducting a market research study, Schultz Manufacturing decided to produce a new interior door to complement its exterior door line. It is estimated that the new interior door can be sold at a target price of $60. The annual target sales volume for interior doors is 20,000. Schultz has target operating income of 20% of sales.
What is the target cost?
a. $900,000
b. $960,000
c. $1,260,000
d. $1,008,000
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