Question 3 of 13

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The bill of materials for each product at Pauls Office Supply is very specific, right down to the number of casters needed for each office chair. Paul recognizes how important these documents are for planning purposes, but his operations managers appreciate them as well since they use this information to guide their material requisitions when its time for production. Here are the budgeted product costs and selling prices, respectively, for the companys three key products:

		Product Cost		Selling Price
Office chair		$120		$209
Sit-to-stand desk		205		345
Printer stand		100		185

Paul has fine-tuned all cost expectations for his products, and his selling prices are quite stable for each product, as well. So, to say Paul was surprised when his accountant reported significantly less profit margin than what he was expecting is the understatement of the year. According to the accountant, the difference is almost entirely attributable to the significant and recent increase in shipping costs for the company's raw materials. These higher freight costs caused a 20% increase to the budgeted product costs presented above.

How much of a reduction in gross margin did each product sustain after recognizing the higher costs? (Round answers to 2 decimal places, e.g. 52.75%.)

		Office chair		Sit-to-stand desk		Printer stand
Gross margin percentage		%		%		%