Target costing

for example, 1) $5m divided by 40000= $125 investment per unit 2) 125 multiplied by 30%= $37.50 profit per unit 3)(Sp - profit)=67.50-37.50=$30 target cost per unit

I do actually say in the lecture that it is irrelevant how you go about calculating the target cost (provided, of course, you get the correct answer :-) ) (I do hope that you are watching the lectures and not using the notes on their own. It is in the lectures that I explain and expand on the notes - they are only lecture notes. If you are not watching the lectures for any reason then you must buy a Study Text from one of the ACCA approved publishers and study from that.)