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Lewis Enterprises management has budgeted the following amounts for its next fiscal year: Total fixed expenses Selling price per unit Variable expenses per unit $500,000

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Lewis Enterprises management has budgeted the following amounts for its next fiscal year: Total fixed expenses Selling price per unit Variable expenses per unit $500,000 $1,000 $750 a. Requirements: If Lewis Enterprises can reduce fixed expenses by $25,000, how will breakeven sales in units be affected? b. If Lewis Enterprises spends an additional $1,000 on advertising, sales volume should increase by 1,000 units. What effect will this have on operating income? If Lewis Enterprises can reduce fixed expenses by $40,000, by how much can variable expenses per unit increase and still allow the company to maintain the original breakeven sales in units? If fixed expenses increase by 25%, to maintain the original breakeven sales in d. units, what would be the selling price per unit have to be? C

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