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		2			2		$	110	/ea
Video monitors		2			2		$	65	/ea
Motion detectors		4			7		$	10	/ea
Floodlights		2			6		$	5	/ea
Alarms		2			1		$	11	/ea
Wiring		690	ft.		1,090	ft.	$	0.2	/ft.
Installation		15	hr		25	hr	$	10	/hr

The ICU 100 sells for $820 installed, and the ICU 900 sells for $1,530 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 $760 and on the ICU 900 to $1,400 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.