WinterParadises operates a Rocky Mountain ski resort. The company is planning its lift ticket pricing for the coming ski season. Investors would like to earn a 15% return on the company's $115 million of assets. The company incurs primarily fixed costs to groom the runs and operate the lifts. WinterParadises projects fixed costs to be $43,500,000 for the ski season. The resort serves 900,000 skiers and snowboarders each season. Variable costs are $10 per guest. Currently, the resort has such a favorable reputation among skiers and snowboarders that it has some control over the lift ticket prices. 1. Would WinterParadises emphasize target costing or cost-plus pricing. Why? 2. If other resorts in the area charge $66 per day, what price should WinterParadises charge? 1. Would WinterParadises emphasize target costing or cost-plus pricing. Why? WinterParadises should emphasize a cost-plus approach to pricing because it has been able to differentiate its ski resort from others in the area. Because of its favorable reputation, managers will have some control over pricing. Of course, they still need to consider whether the target price is within the range customers are willing to pay. 2. If other resorts in the area charge $66 per day, what price should WinterParadises charge? Complete the following table to calculate the price WinterParadises should charge. (Round your answer to the nearest cent.) Total variable costs Plus: Fixed costs Number of skiers / snowboarders Plus: Target revenue Divided by: Price per lift ticket 9,000,000 43,500,000 If other resorts in the area charge $66 per day, what price should WinterParadises charge? The price is be able to charge competing ski resorts in the area. Given WinterParadises reputation, they should a day without affecting their volume.