Elizabeth 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 $34,200 in fixed costs to the $411.000 currently spent. In addition, Elizabeth is proposing that a 5% price decrease ($60 to $57) will produce a 20% increase in sales volume (20,000 to 24,000). Variable costs will remain at $36 per pair of shoes, Management is impressed with Elizabeth'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 Elizabeth's changes are introduced. BARGAIN SHOE STORE CVP Income Statement Current New $ Would you make the changes suggested? V $ GA Gross Profit Sales Contribution Margin Net Income/(Loss) Variable Expenses Administrative Expenses Selling Expenses Fixed Expenses Cost of Goods Sold V $ (b) Compute the current break-even point in sales units, and compare it to the break-even point in sales units if Elizabeth's ideas are implemented. (Round answers to decimal places, e.g. 5,275) Current break-even point pairs of shoes New break-even point pairs of shoes (c) Compute the margin of safety ratio for current operations and after Elizabeth's changes are introduced. (Round answers to o decimal places, eg. 15%.) Current margin of safety ratio New margin of safety ratio e Textbook and Media