Problem - Stone Site Inc. has developed a stone cookie sheet and plans to sell it for $55 per sheet. Prototypes of the stoneware are costing $30. Management believes Stone Site Inc. can reduce the cost substantially and it wants to earn a return of 26% of the selling price.
Determine the target cost per unit that would earn their desired 26% return.
If instead they want to earn a 38% return, what would the target cost be?