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		4			2		$	103	/ea
Video monitors		4			4		$	20	/ea
Motion detectors		2			5		$	11	/ea
Floodlights		2			4		$	3	/ea
Alarms		4			3		$	10	/ea
Wiring		670	ft.		1,070	ft.	$	0.1	/ft.
Installation		13	hr		23	hr	$	10	/hr

The ICU 100 sells for $840 installed, and the ICU 900 sells for $1,550 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 $780 and on the ICU 900 to $1,420 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.