Answer:
The target cost of the Comdex Inc.'s product is $105.
Explanation:
As the competitor offers the same product at lower price and there is no certain information that Comdex Inc.'s parts has other competitive advantages, it is reasonable for the company's management to revise its selling price to $140 to remain competitive in the market and maintain current revenue level.
The profit desire per one part sold under new price = $140 x 25% = $35.
Thus, the Target Cost under new selling price = New selling price - Profit desire = $140 - $35 = $105.
