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and also income statment for current operations Debra King is the advertising manager for Cullumber Shoe Store. She is currently working on a major promotional
and also income statment for current operations
Debra King is the advertising manager for Cullumber Shoe Store. She is currently working on a major promotional campaign. Her ideas include the installation of a new lighting system and increased display space that will add $23,040 in fixed costs to the $276,480 currently spent. In addition, Debra is proposing that a 10% price decrease ($27 to $24) will produce a 20% increase in sales volume (25,600 to 30,720). Variable costs will remain at $12 per pair of shoes. Management is impressed with Debra's ideas but are concerned about the effects that these changes will have on the break-even point and the margin of safety. Calculate the current break-even point in units, and compare it with the break-even point in units if Debra's ideas are used. Current break-even point Break-even point if Debra's ideas are used Question Part Score units units --/2 Calculate the margin of safety ratio for current operations and after Debra's changes are introduced. (Round final answers to 2 decimal places, e.g. 15.25%) Current margin of safety ratio Margin of safety ratio Debra's changes are introduced
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