E Homework: Ch 3 Quiz Question 4, E3-31 (similar to) HW Score: 0%, 0 of 25 points Part 1 of 9 Points: 0 of 6 Save Chloe Rugs is holding a 2-week carpet sale at John's Club, a local warehouse store. Chloe Rugs plans to sell carpets for $750 each. The company will purchase the carpets from a local distributor for $480 each, with the privilege of returning any unsold units for a full refund. John's Club has offered Chloe Rugs two payment alternatives for the use of space. i (Click the icon to view the additional information.) Read the requirements. C.. Requirement 1. Calculate the breakeven point in units for (a) Option 1 and (b) Option 2. Begin by determining the formula to calculate the breakeven point in units. Number of units to breakeven = - X Requirements - More info 1. Calculate the breakeven point in units for (a) option 1 and (b) option 2. 2. At what level of revenues will Chloe Rugs earn the same operating income . Option 1: A fixed payment of $9,450 for the sale period under either option? . Option 2: 12% of total revenues earned during the sale period a. For what range of unit sales will Chloe Rugs prefer Option 1? Assume Chloe Rugs will incur no other costs. b. For what range of unit sales will Chloe Rugs prefer Option 2? 3. Calculate the degree of operating leverage at sales of 105 units for the two rental options. 4. Briefly explain and interpret your answer to requirement 3. Print Done Print Done Help me solve this Etext pages Get more help - Clear all Check