13-29 Cost-plus, target return on investment pricing. Sweet Tastings makes canay machines and sells them to vendors in cases of 30 bars. Although Sweet Tastings makes a the cost differences are insignificant, and the cases all sell for the same price. bars for vending Sweet Tastings has a total capital investment of $10,000,000. It expects to produce cases of candy next year. Sweet Tastings requires a 12% target return on investmen and sell 400,000 Expected costs for next year are: Variable production costs Variable marketing and distribution costs Fixed production costs Fixed marketing and distribution costs Other fixed costs $3.00 per case $2.00 per case $400,000 $700,000 $500,000 Sweet Tastings pri ces the cases of candy at full cost plus markup to generate profits equal to the target return on capital. Required: 1. What is the target operating income? 2. What is the selling price Sweet Tastings needs to charge to earn the target operating income? Calculate astings is considering increasing its selling price to $13 per case. Assuming production and sales y 109%, calculate Sweet Tastings' return on investment. Is increasing the selling price a good idea? the markup percentage on full cost. Sweet T 3