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UR Safe Systems installs home security systems. Two of its systems, the ICU 100 and...

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Accounting

UR Safe Systems installs home security systems. Two of its systems, the ICU 100 and the ICU 900, have these characteristics:

Design Specifications ICU 100 ICU 900 Cost Data
Video cameras 1 4 $ 114 /ea
Video monitors 1 1 $ 26 /ea
Motion detectors 6 2 $ 18 /ea
Floodlights 8 3 $ 8 /ea
Alarms 1 7 $ 13 /ea
Wiring 610 ft. 1,010 ft. $ 0.1 /ft.
Installation 13 hr 13 hr $ 15 /hr

The ICU 100 sells for $900 installed, and the ICU 900 sells for $1,610 installed.

Required:

1. What are the current profit margin percentages on both systems?

2. UR Safes management believes that it must drop the price on the ICU 100 to $840 and on the ICU 900 to $1,480 to remain competitive in the market. Recalculate profit margin percentages for both products at these price levels and then compute the target cost needed for each product to maintain the current profit margin percentages. (For all requirements, round your percentage answers to 2 decimal places and other answers to the nearest whole dollar amount.)

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