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Oriole Willis is the advertising manager for Bargain Shoe Store. She is currently working on a major promotional campaign. Her ideas include the installation of
Oriole Willis is the advertising manager for Bargain Shoe Store. She is currently working on a major promotional campaign. Her ideas include the installation of a new lighting system and increased display space that will add $34.200 in fixed costs to the $411.000 currently spent. In addition, Oriole is proposing that a 5% price decrease ($60 to $57) will produce a 20% increase in sales volume (20,000 to 24.000). Variable costs will remain at $36 per pair of shoes Management is impressed with Oriole's ideas but concerned about the effects that these changes will have on the break-even point and the margin of safety (a) Your answer is correct. Compute the current break-even point in units, and compare it to the break-even point in units if Oriole's ideas are used Current break-even point 17125 pairs of shoes New break-even point 21200 pairs of shoes eTextbook and Media Attempts: 1 of 3 used (b) Compute the margin of safety ratio for current operations and after Oriole's changes are introduced. (Round answers to decimal places, eg. 15%) Current margin of safety ratio % New margin of safety ratio 26 e Textbook and Media Save for Later Attempts: 0 of 3 used Submit Answer (c) The parts of this question must be completed in order. This part will be available when you complete the part above
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