Kamloops Shoe Store (KSS) operates a chain of shoe stores. The stores carry many styles of sboes that are all sold at the same price. KSS pays a sales commission on each pair of shoes sold. Sales personnel also receive a salary. The following cost and revenue data relate to one of their stores and are typical to all other stores Per Pair 580 Sales Price Variable expenses: Invoice cost Sales Commission Total variable expenses $36 14 50 Per Year Fixed expenses Rent Advertising Salaries Total fixed expenses $160,000 300,000 140.000 $600.000 KSS has asked you to assist in some basic cost-volume profit analysis. I Required: 1. If 38,000 pairs of shoes are expected to be sold in a year, what would be store's margin of safety in sales dollars. 2. Assuming that KSS pays income taxes at a rate of 15%, how much sales do they have to generate in order to achieve an after-tax target net income of $500,000? 3. Refer to the original data. The company is considering eliminating sales commissions entirely in its stores and increasing fixed salaries by $214,000 annually. Would you recommend that the change be made? Explain your