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If the existing unit cost is above a target cost per unit, then the unit selling price is adjusted upward to cover the unit cost.
If the existing unit cost is above a target cost per unit, then the unit selling price is adjusted upward to cover the unit cost. the company should not manufacture and sell this particular product/service. cost analysis is performed to identify which components of the product/service can be targeted for cost reduction. the company should recompute the cost per unit only using the variable unit costs
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