Problem 8-9 Steering Plumbing Fixtures is developing a preplumbed acrylic shower unit. The team developing the product includes representatives from marketing, engineering, and cost accounting. To date, the team has developed a set of features that it plans to incorporate in the unit, including a seat, two shower heads, four body sprays, and a steam unit. With this set of features, the team believes that a price of $5,000 will be attractive in the marketplace. Steering seeks to earn a per unit profit of 30 percent of selling price Calculate the target cost per unit. Target cost s per unit The team has estimated that the fixed production costs associated with the product will be $2,500,000, and variable costs to produce and sell the item will be $2,500 per unit. In light of this, how many units must be produced and sold to meet the target cost per unit? Units produced and sold[ Suppose the company decides that only 1,350 units can be sold at a price of $5,000 and, therefore, the target cost cannot be reached. The company is considering dropping the steam feature, which adds $840 of variable cost per unit. With this feature dropped, the company believes it can sell 2,500 units at $4,000 per unit. Will Steering be able to produce the item at the new target cost or less? units New target cost per unit s New cost per unit Steering able to produce the item at the new target cost or less