DualShaft Inc. manufactures a wide variety of parts for recreational boating, including boat

engines. The component is purchased by OEM (original equipment manufacturers) such as

Mercury and Honda, for use in the larger and more powerful outboards. The units sell for $740

and sales volume averages 55,000 units per year. Recently, DualShaft's major competitor

lowered the price of the equivalent part to $679. The market was very competitive, and DualShaft realized it had to meet the new price or lose significant market share. The controller assembled the following data for the most recent year. Cost and Usage for Production of 55,000 Units:

	Budgeted	Cost Quantity	Actual Cost
Materials	$9,980,000		$10,135,000
Direct Labor	3,996,000		3,895,000
Indirect Labor	5,600,000		5,555,000
Inspection hours		4,000	899,000
Materials handling		111,000	589,000
Machine setups		6.060	1,924,000
Returns and rework		490	100,000
Total Costs			$23,097,000

Required: Calculate the current cost per unit, target cost for maintaining current market share and profitability.