a. If there is a/are performance problem(s), what is/are the major source(s) of the discrepancy(ies) between the industrys marketing performance and that of your employer? Show your calculations and explain your answer (be specific)

b. Calculate the firms 2017 Breakeven Sales figure. What is the new Breakeven Sales figure if the firms management wants to increase next years profit margin by 2% of Total Sales? (hint: the 2% increase in sales becomes a target profit).

Exercise 1 APPLICATION: (SHOW ALL CALCULATIONS) Given the following: Income Statement (End of Year, 2017) Industry % of sales Net Sales 500,000 100 Less: Inventory (B) 60,000 12. 200,000 20,000 Gross Purchases 40 Less: discounts Net Purchases 36 180,000 Total Goods Available 48 240,000 Less: inventory (E) 10 75,000 Total Cost of Goods Sold 165,000 335,000 38 Gross Margin: 62 Less: Variable Expenses Sales Commissions 130,000 26 Deliveries 5,000 1 135,000 200,000 27 Contribution Margin 35 Less: Fixed Expenses Rent 50,000 95,000 5,000 10 Salaries 12 Distribution Rights 1 150,000 23 Net Profit (BT) 50,000 12