Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Waterway Cheese Company has developed a new cheese Slicer called Slim Slicer. The company plans to sell this slicer through its catalog, which it issues
Waterway Cheese Company has developed a new cheese Slicer called Slim Slicer. The company plans to sell this slicer through its catalog, which it issues monthly. Given market research, Waterway believes that it can charge $30 for the Slim Slicer. Prototypes of the Slim Slicer, however, are costing $32. By using cheaper materials and gaining efficiencies in mass production, Waterway believes it can reduce Slim Slicer's cost substantially. Waterway wishes to earn a return of 20% of the selling price. (a) Compute the target cost for the Slim Slicer. Target costs Bonita Company is involved in producing and selling high-end golf equipment. The company has recently been involved in developing various types of laser guns to measure yardages on the golf course. One small laser gun, called LittleLaser, appears to have a very large potential market. Because of competition, Bonita does not believe that it can charge more than $95 for LittleLaser. At this price, Bonita believes it can sell 119,000 of these laser guns. Bonita will require an investment of $7,437,500 to manufacture, and the company wants an ROI of 24% Determine the target cost for one LittleLaser. Target cost
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started