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20 September, 23:47

Ortega Company manufactures computer hard drives. The market for hard drives is very competitive. The current market price for a computer hard drive is $42. Ortega would like a profit of $12 per drive. What target cost Ortega should set to accomplish this objective? Target cost $enter the target cost per hard drive in dollars per hard drive

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  1. 21 September, 00:08
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    Target cost = $30

    Explanation:

    Target cost is derived by subtracting a desired profit margin from a competitive selling price. It represents the cost at which a company must produce in order to achieve a desired profit

    For Ortega Company, the target cost per hard drive can be determined as follows:

    Target cost per unit = Competitive selling - Profit per unit

    = 42 - 12

    = $30
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