Perin Corporation Would Like to Use Target Costing for a New

Multiple Choice

Perin Corporation would like to use target costing for a new product it is considering introducing. At a selling price of $25 per unit, management projects sales of 30,000 units. The new product would require an investment of $500,000. The desired return on investment is 11%. The target cost per unit is closest to:

A) $23.17
B) $25.00
C) $25.72
D) $27.75