Problem related to return on invested assets


Problem: Continue with Option 2, but this time assume that target costing is the most appropriate way to price the smaller meal kit. Upon conducting research, The Blossom Kitchen owners find that similar-quality 2-serving meal kits are selling for $28. If The Blossom Kitchen uses that same price point for its 2-serving meal kits, what is its target cost, given that The Blossom Kitchen desires an 18% return on its invested assets? It has $850,000 in total invested assets, but only $94,000 of this amount is appropriate for the smaller meal kit portion of the business. (Round answer to 2 decimal places, e.g. 15.25.) Target cost per unit

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Accounting Basics: Problem related to return on invested assets
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