Principles of Accounting Volume 2
19th Edition
ISBN: 9781947172609
Author: OpenStax
Publisher: OpenStax College
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How much will company have to cut cost per unit?

Transcribed Image Text:Flare Enterprises sells a product in a competitive marketplace.
Market analysis indicates that its product would probably sell
at $60 per unit. Flare management desires a 15% profit
margin on sales. Their current full cost for the product is $52
per unit. In order to meet the new target cost, how much will
the company have to cut costs per unit, if any?
a. $3
b. $4
C. $5
d. $1
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