UR Safe Systems installs home security systems. Two of its systems, the ICU 100 and the ICU 900, have these characteristics: Design Specifications Video cameras 1. 2. Video monitors Motion detectors Floodlights Alarms Wiring Installation 1 2 4 5 760 feet 20 hour 1,140 feet 20 hour The ICU 100 sells for $970 installed, and the ICU 900 sells for $1,680 installed. ICU 100 2 Current profit margin Profit margin Target cost Required: 1. What are the current gross profit margin percentages on both systems? 2. UR Safe's management believes that it must drop the price on the ICU 100 to $910 and on the ICU 900 to $1,550 to remain competitive in the market. Recalculate gross profit margin percentages for both products at these price levels and then compute the target cost needed for each product to maintain the current gross profit margin percentages. ICU 100 (For all requirements, round your percentage answers to 2 decimal places (i.e. .1234 = 12.34%) and other answers to the nearest whole dollar amount.) % % ICU 900 4 6 1 2 3 Cost Data $ 121/ea $ 55/ea $ 17/ea $3/ea $ 18/ea ICU 900 % % $ 0.2/feet $ 14/hour
UR Safe Systems installs home security systems. Two of its systems, the ICU 100 and the ICU 900, have these characteristics: Design Specifications Video cameras 1. 2. Video monitors Motion detectors Floodlights Alarms Wiring Installation 1 2 4 5 760 feet 20 hour 1,140 feet 20 hour The ICU 100 sells for $970 installed, and the ICU 900 sells for $1,680 installed. ICU 100 2 Current profit margin Profit margin Target cost Required: 1. What are the current gross profit margin percentages on both systems? 2. UR Safe's management believes that it must drop the price on the ICU 100 to $910 and on the ICU 900 to $1,550 to remain competitive in the market. Recalculate gross profit margin percentages for both products at these price levels and then compute the target cost needed for each product to maintain the current gross profit margin percentages. ICU 100 (For all requirements, round your percentage answers to 2 decimal places (i.e. .1234 = 12.34%) and other answers to the nearest whole dollar amount.) % % ICU 900 4 6 1 2 3 Cost Data $ 121/ea $ 55/ea $ 17/ea $3/ea $ 18/ea ICU 900 % % $ 0.2/feet $ 14/hour
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Meman
![Required information
[The following information applies to the questions displayed below.]
UR Safe Systems installs home security systems. Two of its systems, the ICU 100 and the ICU 900, have these
characteristics:
Design Specifications
Video cameras
Video monitors
Motion detectors
ICU 100
2
1
2
4
5
760 feet
20 hour
1,140 feet
20 hour
The ICU 100 sells for $970 installed, and the ICU 900 sells for $1,680 installed.
Floodlights
Alarms
Wiring
Installation
1. Current profit margin
2.
Profit margin
Target cost
Required:
1. What are the current gross profit margin percentages on both systems?
2. UR Safe's management believes that it must drop the price on the ICU 100 to $910 and on the ICU 900 to $1,550 to remain
competitive in the market. Recalculate gross profit margin percentages for both products at these price levels and then compute the
target cost needed for each product to maintain the current gross profit margin percentages.
ICU 100
(For all requirements, round your percentage answers to 2 decimal places (i.e. .1234 = 12.34%) and other answers to the nearest
whole dollar amount.)
%
%
ICU 900
4
6
1
2
3
ICU 900
Cost Data
$ 121/ea
$ 55/ea
$ 17/ea
$ 3/ea
$18/ea
%
%
$ 0.2/feet
$ 14/hour](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F404882d8-9c43-40ab-86a8-8a92a0555f9d%2F31046ca8-d346-47e5-b988-4bc1bb65379b%2Fk8z37se_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below.]
UR Safe Systems installs home security systems. Two of its systems, the ICU 100 and the ICU 900, have these
characteristics:
Design Specifications
Video cameras
Video monitors
Motion detectors
ICU 100
2
1
2
4
5
760 feet
20 hour
1,140 feet
20 hour
The ICU 100 sells for $970 installed, and the ICU 900 sells for $1,680 installed.
Floodlights
Alarms
Wiring
Installation
1. Current profit margin
2.
Profit margin
Target cost
Required:
1. What are the current gross profit margin percentages on both systems?
2. UR Safe's management believes that it must drop the price on the ICU 100 to $910 and on the ICU 900 to $1,550 to remain
competitive in the market. Recalculate gross profit margin percentages for both products at these price levels and then compute the
target cost needed for each product to maintain the current gross profit margin percentages.
ICU 100
(For all requirements, round your percentage answers to 2 decimal places (i.e. .1234 = 12.34%) and other answers to the nearest
whole dollar amount.)
%
%
ICU 900
4
6
1
2
3
ICU 900
Cost Data
$ 121/ea
$ 55/ea
$ 17/ea
$ 3/ea
$18/ea
%
%
$ 0.2/feet
$ 14/hour
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