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Majesty Company uses target costing to ensure that its products are profitable. Assume Majesty is planning to introduce a new product with the following estimates:

Majesty Company uses target costing to ensure that its products are profitable. Assume Majesty is planning to introduce a new

product with the following estimates:

Required:

Compute the target cost of this product.

Compute the target cost if Majesty wants a

39

percent return on sales.

Compute the target cost if Majesty wants a

6

percent return on sales.

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