ChocAttack makes candy bars for vending machines and sells them to vendors in cases of 30 bars. Although Choc Attack makes a variety of candy, the cost differences are insignificant, and the cases all sell for the same price. ChocAttack has a total capital investment of $19,000,000. It expects to produce and sell 650,000 cases of candy next year. ChocAttack requires a 12% target return on investment. Expected costs for next year are: Variable production costs $4.00 per case Variable marketing and distribution costs $2.50 per case Fixed production costs $95,000 Fixed marketing and distribution costs $800,000 Other fixed costs $400,000 ChocAttack prices the cases of candy at full cost plus markup to generate profits equal to the target return on capital.
Read the requirements:
1. What is the target operating income? (Enter the percentage as a whole number.) x = Target operating income x % =
