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Market Research

The following applies to all 4 parts:

After conducting a market research study, Morla Manufacturing decided to produce a new interior door to complement its exterior door line. It is estimated that the new interior door can be sold at a target price of $60. The estimated annual target sales volume is $20,000 interior doors. Morlan has a 20% expected return on sales target.

1) What are the total target sales

$960,000, $2,000,000, $1,200,000, or none of these

I believe - $1,200,000 is the answer - please advise of answer and why - thanks!

2) What is the total target profit

$240,000, $12,000, $960,000, or none of these

I believe - $240,000 is the answer - please advise answer & why - thanks!

3) What is the total target costs

$192,000, $960,000, $1,152,000, or done of these

I believe - $960,000 - is the answer - please advise answer & why - thanks!

4) What is the target cost per interior door

$48, 58, 60, or none of these

I believe $48 is the answer - please answer & why - thanks!

Solution Preview

1. Total target sales = target sales volume*target sales price
=20000*60
=$1,200,000

2. ...

$2.19