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27- Rolling Hills Golf Course is planning for the coming golfing season. Investors would like to earn a 15% return on the company's $50,000,000 of
27-
Rolling Hills Golf Course is planning for the coming golfing season. Investors would like to earn a 15% return on the company's $50,000,000 of assets. The company primarily incurs fixed costs to groom the greens and fairways. Fixed costs are projected to be $30,000,000 for the season. About 600,000 rounds of golf are expected to be played each year. Variable costs are about $16 per round of golf. Rolling Hills Golf Course has a favorable reputation in the area and, therefore, has some control over the sales price of a round of golf. Using a cost- - plus pricing approach, what sales price should Rolling Hills charge for a round of golf to achieve the desired profit? A. $34 B. $50 C. $66 D. $79Step by Step Solution
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