$2000 Example 1: Target Costing Material Cost (70% Direct, 30% Indirect) $15000 Labor Cost (80% Direct, 20% Indirect) $10000 Supervisor Salary Profit Margin 30% of total cost Total Units produced are 5000 A. Calculate total cost (direct and Indirect) B. Calculate Selling Price C. If Market price is 30000, what will be Target cost per unit? Example 2: Target Costing Material Cost (80% direct, 20% indirect) Mattel 10000 units @ 50 Plastic 2000 unit @ 20 miscellaneous supplies for production support 2000 units @ 10 Labor cost 10 labors with 40000 hours (70% direct, 30% indirect) Manufacturing overhead Indirect Material 8000 Indirect Labor 4000 Security guard salary 2000 Factory Electricity Expense 1000 General Manager salary 20000 Profit Margin 40% of total cost Total Units produced are 50 000 units Required: A. Calculate Total Direct cost and Total Indirect Cost B. Calculate Total Product Cost and Cost per unit C. If the Market price is 1200000 what will be the target cost