Saturday, September 17, 2011

What is the target operating income?

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 operating income?

a. $240,000

b. $300,000

c. $192,000

d. $180,000

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