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Sagot :
The target cost for each interior door is $96.
What is manufacturing?
- Manufacturing is the process of creating or producing items with the aid of resources such as machinery, manpower, tools, chemicals, or biological formulations.
- It is the core of the economy's secondary sector.
What is operating cost?
- Operating costs, often known as operating costs, are the costs associated with running a company, or with running a machine, part, piece of equipment, or facility.
- They represent the cost of the resources an organization uses just to stay in business.
Solution -
Total revenue of the year (sales) = $120 × 20,000 = 24,00,000
Operating cost = 20% of sales = 4,80,000
Target cost of each door = 4,80,000 ÷ 20,000 = $24
120 - 24 = $96
Therefore, the target cost for each interior door is $96.
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