Land...... Construction. . . Landscaping... Variable marketing costs ... . . $ 52,000 ... $ 122,000 $ 6,000 $ 3,000 Dominic Builders builds 1,500-square-foot starter tract homes in the fast-growing suburbs of Atlanta. Land and labor are cheap, and competition among developers is fierce. The homes are "cookie-cutter," with any upgrades added by the buyer after the sale. Dominic Builders' cost per developed sublot are as follows: (Click the icon to view the costs.) Dominic Builders would like to earn a profit of 14% of the variable cost of each home sale. Similar homes offered by competing builders sell for $202,000 each. Read the requirements. Dominic will need to emphasize a target-costing approach to pricing. Because the tract homes are not unique and face stiff competition, Dominic will not have much control over pricing. Requirement 2. Will Dominic Builders be able to achieve its target profit levels? Show your computations. Complete the following table to show whether Dominic Builders will be able to achieve their target profit levels. (Use parentheses or a minus sign to indicate a profit shortfall.) Revenue at market price $ 202,000 Less: Desired profit 25,620 Target cost per home $ 176,380 Less: Actual current variable cost 183,000 Expected excess profit (profit shortfall) $ (6,620) Given the current market price and Dominic Builder's current variable costs, the company will its target profit. Its profit will by per home sale. to achieve 2. Will Dominic Builders be able to achieve its target profit levels? Show your computations. 3. Bathrooms and kitchens are typically the most important selling features of a home. Dominic Builders could differentiate the homes by upgrading bathrooms and kitchens. The upgrades would cost $20,000 per home but would enable the company to increase the selling prices by $35,000 per home (in general, kitchen and bathroom upgrades typically add at least 150% of their cost to the value of any home.) If Dominic Builders upgrades, what will the new cost-plus price per home be? Should the company differentiate its product in this manner? Show your analysis.