CVP, shoe stores (continuation of 3-39). Refer to requirement 3 of 3-39.

Required 1. Calculate the number of units sold where the operating income under

(a) a fixed salary plan and

(b) a lower fixed salary and commission plan (for salespeople only) would be equal.

Above that number of units sold, one plan would be more profitable than the other; below that number of units sold, the reverse would occur.

2. Compute the operating income or loss under each plan in requirement 1 at sales levels of

(a) 50,000 units and

(b) 60,000 units.

3. Suppose the target operating income is $201,600. How many units must be sold to reach the target under

(a) the fixed salary plan and

(b) the lower fixed salary and commission plan?