Candy Rugs is holding a 2-week carpet sale at Jean's Club, a local warehouse store. Candy Rugs plans to sell carpets for $500 each. The company will purchase the carpets from a local distributor for $350 each, with the privilege of returning any unsold units for a full refund. Jean's Club has offered Candy Rugs two payment alternatives for the use of space. (Click the icon to view the additional information.) Read the requirements. Requirement 1 Calculate the braakauan saint in unite for lal Action 1 and (b) Ontion 2 Requirements Begi More info er unit N 1. Calculate the breakeven point in units for (a) option 1 and (b) option 2. 2. Cald ole number. En Option 1: A fixed payment of $5,100 for the sale period At what level of revenues will Candy Rugs eam the same operating income under either option? Option 2: 10% of total revenues eamed during the sale period Assume Candy Rugs will incur no other costs. a. For what range of unit sales will Candy Rugs prefer Option 1? (a) (b) b. For what range of unit sales will Candy Rugs prefer Option 2? 3. Calculate the degree of operating leverage at sales of 102 units for the two rental options. Req Print Done Begi 4. Briefly explain and interpret your answer to requirement 3. tion? a. For wh In used: FC F Print Done SP * Q) - ( VC Q) FC = ( SP Q) - (VC FC "Now calculate the level of revenues. It will take using these units equal units to generate the same operating income under either option. The level of revenues under either option prefer option 2?