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1. Award 16.00 points Bubbas Western Wear is a western hat retailer in Lubbock Texas Although Bubba's carries numerous styles of western hats, each hat
1. Award 16.00 points Bubbas Western Wear is a western hat retailer in Lubbock Texas Although Bubba's carries numerous styles of western hats, each hat has approximately the same price and invoice (purchase) cost as shown in the following table Sales personnel receive a commission to encourage them to be more aggressive in their sales efforts Currently, the Lubbock economy is really humming and sales growth af Bubba s has been great. The business is very competitive, however and Bubba, the owner has relied on his knowledgeable and courteous staff to attract and retain customers who otherwise might go to other western wear stores Because of the rapid growth in sales, Bubba is also finding the management of certain aspects of the business more difficult such as restocking inventory and hiring and training new salespeople $ 80.00 23.50 3150 Sales price Per unit variable expenses Purchase COSE Sales Commissions Total per unit variable costs Total anual fixed expenses Advertising Rent Salanes Total fixed expenses $ 55.00 S 297,500 248.000 397 000 $942.500 Required: Calculate the annua break even both terms of units and in terms of sales dollars 2 Bubba's sells 39.000 hats what its before tax income or oss? Support your answer by preparing a contribution income statement 3 Bubbes sells 52000 hats what is its margin of safety MOS) in dollars and MOS ratio? Bubba is con derrothe r aton of sales commissions completely and increasing salaries by $357,000 annually What would be the new breakeven poin t s? What woud be the before tax income or loss if 39.000 hats are sold with the new salary plan? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Cite the annual breakeven point, both in terms of units and in terms of sales dollars nota
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