Examine the principles, problems and policies of Target.
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Use the Google search engine to locate the home page of Target. Find and review the company's income statement in its annual report and classify the nonrevenue items as either fixed or variable costs. Are all costs clearly identifiable as either fixed or variable? What item would be considered accounting profit? Would economic profit be higher or lower than the accounting profit?
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Examine the principles, problems and policies of Target.
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The income statement of target is found here. http://sites.target.com/site/en/company/page.jsp?contentId=WCMP04-051749
We now classify each expense as fixed of variable,
Cost of sales - variable
Selling, general and administrative expenses - see next section
Credit card expenses - variable
Depreciation and amortization - fixed
Nonrecourse debt collateralized by credit card receivables - fixed
Other interest expense - fixed
The only cost that may not be immediately ...
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