please answer question 2

(thousands of dollars) 2003 2004 2005 $8,583 4.326 $4,257 $8,102 4.132 $3,970 $10,711 5.570 $ 5,141 Salos Cost of goods sold Gross margin Expenses Selling expense Salaries Commissions Advertising Administrative expenses Ront Depreciation Miscellaneous expenses Total expenses Net Income 2,021 429 254 418 420 84 53 $3,679 $ 578 2,081 405 250 425 420 84 93 $3,758 $ 212 3.215 536 257 435 840 142 122 $ 5,547 $ (406) Source: Casewriter Exhibit 2 Hallstead Jewelers Operating Statistics 2003 2001 2006 Sales space (square feet) Salos per square foot Sales tickets Average sales ticket 10.230 $ 839 5,341 $ 1,607 10.230 $ 792 5,316 $1,524 15,280 $ 701 6,897 $1,553 Questions. 1. How has the breakeven point in number of sales tickets (number of customer orders written) and breakeven in sales dollars changed from 2003, to 2004, and to 2006? How has the margin of safety changed? What caused the changes? 2. One idea that the consultant had was to reduce prices to bring in more customers. If average prices were reduced ten percent (10%), and the number of sales tickets (unit sales) increased to 7.500, would the company's income be increased? With prices reduced, what would be the new breakeven point in sales tickets and sales dollars? Please show all calculations