Well Water Inc. wants to produce and sell a new flavored water. In order to penetrate the market, the product will have to sell at $2.00 per 12 oz. bottle. The following data has been collected:
Annual sales 50,000 bottles
Projected selling and administrative costs $8,000
Desired profit $70,000
The target cost per bottle is
a) $0.60.
b) $0.16.
c) $0.40.
d) $0.44.
Answer: a) $0.60.
Business
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