Target costing) Buggin Corporation is developing a propane-powered mos¬ quito zapper for campers. Market research has indicated that potential pur¬ chasers would be willing to pay $225 per unit for this product. Company engineers have estimated that first-year production costs would amount to $230 per unit. On this type of product, Buggin would normally expect to earn $20 per unit in profits. Using the concept of target costing, write a memo that (1) analyzes the prospects for this product and (2) discusses pos¬ sible organizational strategies.

LO.1