What is Division A target full product cost

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Question - Doug Dixon, majority stockholder and president of Dixon, Inc., is working with his top managers on future plans for the company. As the company's managerial accountant, you've been asked to analyze the following situations and make recommendations to the management team.

Division A of Dixon, Inc. has $5,000,000 in assets. Its yearly fixed costs are $684,000, and the variable costs of its product line are $1.35 per unit. The division's volume is currently 520,000 units. Competitors offer a similar product, at the same quality, to retailers for $3.60 each. Dixon's management team wants to earn a 10?% return on investment on the division's assets. What is Division A's target full product cost?

Reference no: EM132751753

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