2. Develop a profit-and-loss statement for the Westgate division of North Industries. This division manufactures light fixtures sold to consumers through home improvement and hardware stores. Cost of goods sold represents 40 per cent of net sales. Marketing expenses include selling expenses, promotion expenses and freight. Selling expenses include sales salaries totalling €3 million per year and sales commissions (5 per cent of sales). The company spent

€3 million on advertising last year, and freight costs were 10 per cent of sales. Other costs include

€2 million for managerial salaries and expenses for the marketing function and another

€3 million for indirect overhead allocated to the division. Develop the profit-and-loss statement if net sales were €20 million last year. Develop the profit-and-loss statement if net sales were €40 million last year. Calculate Westgate’s break-even sales.