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25-3 Please answer all required fields. Requirements 1. Green House's owners want to earn an 11% return on investment on the company's assets. What is
25-3 Please answer all required fields.
Requirements 1. Green House's owners want to earn an 11% return on investment on the company's assets. What is Green House's target full product cost? 2. Given Green House's current costs, will its owners be able to achieve their target profit? 3. Assume Green House has identified ways to cut its variable costs to $1.75 per unit. What is its new target fixed cost? Will this decrease in variable costs allow the company to achieve its target profit? 4. Green House started an aggressive advertising campaign strategy to differentiate its plants from those grown by other nurseries. Green House does not expect volume to be affected, but it hopes to gain more control over pricing. If Green House has to spend $90,000 this year to advertise and its variable costs continue to be $1.75 per unit, what will its cost-plus price be? Do you think Green House will be able to sell its plants to garden centers at the cost-plus price? Why or why not? Print Done
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