ABC Gardening operates a commercial plant nursery where it propagates plants for garden centers throughout the region. ABC Gardening has $3.5 million in assets. Its yearly fixed costs are $470,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-sized plant total $1.60. ABC Gardening's volume is currently 500,000 units. Competitors offer the same quality plants to garden centers for $3.30 each. Garden centers then mark them up to sell to the public for $8 to $11, depending on the type of plant. Read the requirements. Requirement 1. ABC Gardening owners want to earn a 13% return on the company's assets. What is ABC Gardening's target full cost? Calculate the target full cost for ABC Gardening. Select the formula labels and enter the amounts. Less: Target full cost Requirements 1. ABC Gardening owners want to earn a 13% return on the company's assets. What is ABC Gardening's target full cost? 2. Given ABC Gardening's current costs, will its owners be able to achieve their target profit? Show your analysis. 3. Assume that ABC Gardening has identified ways to cut its variable costs to $1.45 per unit. What is its new target fixed cost? Will this decrease in variable costs allow the company to achieve its target profit? Show your analysis. 4. ABC Gardening started an aggressive advertising campaign strategy to differentiate its plants from those grown by other nurseries. ABC Gardening doesn't expect volume to be affected, but it hopes to gain more control over pricing. If ABC Gardening has to spend $40,000 this year to advertise and its variable costs continue to be $1.45 per unit, what will its cost-plus price be? Do you think ABC Gardening will be able to sell its plants to garden centers at the cost-plus price? Why or why not? Print Done -