Leanne Outdoors sells camping equipment. One of the company's products, a camp stove, sells for $$80$ per unit. Variable expenses are $$60$

per stove, and fixed expenses associated with the stove total $$120,000$ per month.

Required:

Compute the company's break$-$even point in number of stoves and in total sales dollars.

If the variable expenses per stove increase as a percentage of the selling price, will it result in a higher or a lower break$-$even point? Why?

$($Assume that the fixed expenses remain unchanged.$)$

At present, the company is selling $8,000$ stoves per month. The sales manager is convinced that a $$3$ per unit reduction in the selling

price will result in a $20\%$ increase in the number of stoves sold each month. Prepare two contribution format income statements: one

under present operating conditions, and one as operations would appear after the proposed changes. Show both total and per$-$unit data

on your statements.

Refer to the data in Requirement $(3)$ above. How many stoves would have to be sold at the new selling price to yield a minimum net

operating income of $$72,000$ per month?