2 J.M. Blogs runs a shoe shop outside Kilkenny. His Income Statement for the year ended December 2020 is as follows:

Sales (10,000 pairs at 80 per unit 800,000

Cost of Sales (10,000 pairs at 52) 520,000

Gross Profit 280,000

Fixed Expenses

Rent 70,000

Rates 38,000

Electricity 16,000

Heating 16,000

Shop Assistants Salary 28,000 168,000

Net Profit 112,000

J.M. Blogs has been offered a larger shop in the city centre. The shop will be in a central position, rent will increase by 100% and rates will increase by 50% and electricity and heating will increase in each case by 25% and he will need two extra shop assistants at a cost of 28,000 each. He is of the opinion that if he reduces his selling price by 5% he will increase his sales by 100%.

(a) Calculate the existing break-even point in units and sales value.

(b) Calculate the break-even point in units and sales value in the city centre shop.

(c) How many units would he need to sell in the city centre shop to double his present profits before taxation?

(d) If he did not reduce his selling price, how many units would he need to sell to break-even in the larger shop?

(e) If he did not reduce his selling price, how many units would he need to sell to achieve the profit he is presently obtaining?