Vaughn Manufacturing wants to produce and sell a new flavored water. In order to penetrate the market, the product will have to sell at $2 per 12 oz. bottle. The following data has been collected: Annual sales 50000 bottles Projected selling and administrative costs $7600 Desired profit $80000 The target cost per bottle is $0.60. $0.15. $0.25. $0.40.

Vaughn Manufacturing wants to produce and sell a new flavored water. In order to penetrate the market, the product will have to sell at $2 per 12 oz. bottle. The following data has been collected: Annual sales 50000 bottles Projected selling and administrative costs $7600 Desired profit $80000 The target cost per bottle is $0.60. $0.15. $0.25. $0.40.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter10: Short-term Decision Making

Section: Chapter Questions

Problem 6MC: Jansen Crafters has the capacity to produce 50,000 oak shelves per year and is currently selling...

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Concept explainers

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

Question

Vaughn Manufacturing wants to produce and sell a new flavored water. In order to penetrate the market, the product will have to sell at $2 per 12 oz. bottle. The following data has been collected:

Annual sales	50000 bottles
Projected selling and administrative costs	$7600
Desired profit	$80000

The target cost per bottle is

$0.60.

$0.15.

$0.25.

$0.40.

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Sheridan Company wants to produce and sell a new flavored water. In order to penetrate the market, the product will have to sell at $2 per 12 oz. bottle. The following data has been collected: Annual sales 50000 bottles Projected selling and administrative costs $8500 Desired profit $62000 The target cost per bottle is $0.59. $0.24. $0.17. $0.76.
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