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What is target cost per unit? Question content area bottom

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter12: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 4SEQ: For which cost concept used in applying (he cost-plus, approach to product pricing are fixed...

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Question

What is target cost per unit?

Question content area bottom

Part 1

Target cost per unit is the contribution margin per unit over the average total unit cost.

Target cost per unit is the average total unit cost over the contribution margin ratio.

Target cost per unit is the variable unit cost over the product's life cycle.

Target cost per unit is the average total unit cost over the product's life cycle.

Definition Definition Total cost of producing a certain quantity of a good, divided by the quantity produced. It is the sum of all costs (fixed and variable) required to produce one unit of output.

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