Complete all Parts of A, B, and C Please : )

Complete all Parts of A, B, and C Please : )

Complete all Parts of A, B, and C Please : )

Mary Willis is the advertising manager for Bargain 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 $29,000 in fixed costs to the $270,000 currently spent. In addition, Mary is proposing that a 5% price decrease ( $40 to $38 ) will produce a 25% increase in sales volume (20,000 to 25,000 ). Variable costs will remain at $25 per pair of shoes. Management is impressed with Mary's ideas but concerned about the effects that these changes will have on the break-even point and the margin of safety. (a) Prepare a CVP income statement for current operations and after Mary's changes are introduced. Compute the current break-even point in sales units, and compare it to the break-even point in sales units if Mary's ideas are implemented. (Round answers to 0 decimal places, e.g. 5,275.) Current break-even point pairs of shoes New break-even point pairs of shoes Compute the margin of safety ratio for current operations and after Mary's changes are introduced. (Round answers to 0 decimal places, e.g. 15\%.) Current margin of safety ratio % New margin of safety ratio \% Would you make the changes suggested