Fine Leather Ltd has provided the following production and sales information for each pair of its dress shoes.

The fixed costs for the period are \($1\) 125 000.
Required
(a)    Calculate the break-even point.
(b)    Calculate the number of pairs that must be sold to achieve a profit of \($63\) 000. What is the margin for safety at this sales level?
(c)    Would it be better to sell 16 000 pairs at a selling price of \($180\) each or 19 000 pairs at a selling price of \($160?
(d)\)    If an additional \($63\) 270 is spent on fixed advertising costs, what level of dollar sales must be attained to earn a new profit of \($36\) 000? Assume that there has been no change in the sales price.
(e)    Assume an income tax rate of 30%. Using the given information, how many pairs of shoes need to be sold to earn an after-tax profit of \($37\) 800?
 

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Direct materials Direct labour Variable factory overhead Selling price Sales commissions $ 22 35 15 180 10% of the selling price