Green Thumb operates a chain of lawn fertilizer stores. Although the fertilizer is sold under the Green Thumb label, it is purchased from an independent manufacturer.
Sue Smith, president of Green Thumb, is studying the advisability of opening another store. Her estimates of monthly costs for the proposed location are:
Fixed costs:
Occupancy costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	$5,000	50% is manufacturing related and 50% for office
Salaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2,400	all office
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,600	20% is manufacturing related and 80% is office
Variable costs (including cost of fertilizer) . . . . . . . . . . . . . . . . . . . . . . . . . . .	$12.00	per bag
Although Green Thumb stores sell several different types of fertilizer, monthly sales revenue consistently averages $20 per bag sold.
Instructions(show all detailed calculations for partial credit) - it might be beneficial to answer question 4 first and then link the other calculations.
4. Smith thinks that the proposed store will sell between 1,500 and 1,800 bags of fertilizer per month. Prepare two Cost Volume Profit Income Statements in good format for these 2 volumes. Please include per unit also.
5. Prepare two traditional income statements for 1500 and 1800 units.
6. If the company purchases materials from a new vendor for $10 per bag but the quality will impact the sales price. How low can the sales price go and still maintain the same contribution margin.