Assume that a company plans to introduce a new product to the market at a target selling price of $20 per unit. It is investing $4,000,000 to purchase the equipment needed to produce and sell 250,000 units per year. Assuming the companys required rate of return on all investments is 15.50%, what is the new products target cost per unit? Multiple Choice $22.00 $18.52 $23.00 $17.52

pt 2

Assume a company has three productsA, B, and Cthat emerge from a joint process. The selling prices and outputs for each product at the split-off point are as follows:

Product	Selling Price		Output
A	$ 33	per pound	14,000	pounds
B	$ 29	per pound	18,000	pounds
C	$ 24	per pound	19,000	pounds

Each product can be processed further beyond the split-off point. The additional processing costs for each product and their respective selling prices after further processing are as follows:

Product	Additional Processing Costs	Selling Price
A	$ 65,000	$ 37	per pound
B	$ 75,500	$ 34	per pound
C	$ 70,000	$ 30	per pound

What is financial advantage (disadvantage) of further processing Product B?

Multiple Choice

• $14,500

• $4,500

• $6,500

• $8,500