Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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

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 $ 133 /ea
Video monitors 1 1 $ 75 /ea
Motion detectors 3 2 $ 15 /ea
Floodlights 4 2 $ 6 /ea
Alarms 1 7 $ 20 /ea
Wiring 720 ft. 1,160 ft. $ 0.1 /ft.
Installation 12 hr 22 hr $ 16 /hr

The ICU 100 sells for $990 installed, and the ICU 900 sells for $1,700 installed.

Part 1

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 $930 and on the ICU 900 to $1,570 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.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Organisational Change Audit

Authors: Ralph Houston

1st Edition

1907766014, 978-1907766015

More Books

Students also viewed these Accounting questions