Can you please help me with problem number P6-7B, please!

Problems: Set B 3 (d) Assuming that sales revenue decreases by 30%, prepare a variable costing income statement for each company e)Discuss how the cost structure of these two companies aftects affects their operating leverage and profitability. P6-68 Peaches and Cream Corporation manufactures cosmetic products that are sold through a network of sales agents. The agents are paid a commission of 16 25% of sales The income statement for the year ending December 31, 2017, is shown on the next page Determine contribution aet sales, and break-even poimt maren, operating levrrage. LO 1, 4, A)N Peaches and Cream Corporation Income Statement For the Year Ended December 31, 2017 Sales Cost of goods sold S120,000,000 Variable Fixed Gross margin $5B,500,000 11,000,000 69,500,000 50,500,000 Selling and marketing expenses Commissions Fixed costs 19,500,000 10,000,000 29 500,000 5 21,000,000 Operating income The company is considering hiring its own sales stalif to replace the network of agents It will pay its salespeople a commission of 10% and incur additional fixed costs of $12,0 million. Instractions (a) Under the current policy of using a network of sales agents, calculate the Peaches and (a) $60,000 Cream Corporation's break-even point in sales dollars for the year 2017 (b) Calculate the company's break-even point in sales dollars for the year 2017 if it hires its own sales force to replace the network of agents (d (2) 3.0 (c) Calculate the degree of operating leverage at sales of $120 million if (1) Peaches and Cream uses sales agents, and ( Describe the advantages and disadvantages of each alternative (d) Calculate the estimated sales volune in sales dollars that would generate an identical ber 31, 2017, regardless of whether Peaches and net income for the year ending Decem Cream Corporation employs its own sales staff and pays them a 10% commisson as well as incurring additional fixed costs of $12.0 million, or continues to use the inde pendent network of agents (CMA Canada-adapted) *P6-7B FAB produces fabrics t the first year of operations, FAB produced 500,000 yards of fabric and sold 400,000 yards. under absarpltion costing In 2017, the production and sales results were exactly reversed. In each year, selling price and va per yard was $2.50, variable manufacturing duced variable selling expenses were 10% of the selling price of units sold fixed manufac- ment on and turing costs were $400,000, and fixed administrative expenses were $1 variable costing for a costs were 30% of the sales price of units pro- company wit 100,000. (LO 5), AN Instructions e statements for each year using variable costing. (Use the format from (a) 2016 Net income $100. Illustration 6A-10.) (b) Prepare income statements for each year using absorption costing. (Use the format (b) 2016 Net income $180, (c) Reconcile the difterences each year in income from operations under the two from llustration 6A-11.) Comment on the effects of production and sales on net income under the two costing approaches. P6-88 Electricoil is a division of Meier Products Corporation. The division manufactures and sells an electric coil used in a wide variety of applications. During the coming year, it expects to sell 200,000 units for $9 per unit. Mark Barnes is the division manager. He is