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Hard Tiles operates a chain of tile stores. Although the tiles are sold under the Hard Tires label, it is purchased from an independent tile
Hard Tiles operates a chain of tile stores. Although the tiles are sold under the Hard Tires label, it is purchased from an independent tile manufacturer. Gal Runner, president of Hard Tires, is studying the advisability of opening another store. Her estimates of monthly costs for the proposed location are: Although Hard Tiles stores sell several different types of tiles, monthly sales revenue consistently average exist12 per box sold. a. Compute the contribution margin ratio and the break-even point in dollar sales and in boxes sold for the proposed store. b. Draw a monthly cost-volume-profit graph for the proposed store, assuming 3,000 boxes per month as the maximum sales potential. c. Runner thinks that the proposed store will sell between 2, 500 and 3,000 boxes of the tiles per month. Compute the amount of operating income that would be earned per month at each of these sales volumes
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