Kupperson,Inc

Essay

Kupperson,Inc.is considering adding an inline roller skate to its product line.Management believes that in order to be competitive,the skate cannot be priced above $65 per pair.The company requires a minimum return of 25% on its investments.Launching the new product would require an investment of $4,000,000.Sales are expected to be 50,000 pairs of skates per year.
Required:
Compute the target cost of a pair of skates.