Please help with E

Calcualte the operating income for each options?

Which plan should Blake implement?

At what level of sales would he be indefferent?

"I'll never understand this accounting stuff"Blake Dunn yelled, waving the income statement he had just received from his accountant in the morning mail. "Last month, we sold 2,000 stuffed State University mascots and earned $6,565 in operating income. This month, when we sold 3,000 I thought we'd make $9,848. But this income statement shows an operating income of $11,615! How can I ever make plans if I can't predict my income? I'm going to give Janice one last chance to explain this to me" he declared as he picked up the phone to call Janice Miller, his accountant "Will you try to explain this operating income thing to me one more time?" Blake asked Janice. "After I saw last month's income statement, I thought each mascot we sold generated $3.28 in net income; now this month, each one generates $3.87! There was no change in the price we paid for each mascot, so I don't understand how this happened. If I had known I was going to have $11,615 in operating income, I would have looked more seriously at adding to our popduct line." Taking a deep breath, Janice replied, "Sure, Blake. I'd be happy to explain how you made so much more operating income than you were expecting." Sales revenue Cost of goods sold Gross proht Rent expense Wages expense Shipping expense Utilities expense Advertising expense Insurance expense Operating income February $25.000 10,000 15,000 1,500 3,500 1,150 750 1,000 585 March $37.500 15,000 22.500 1,500 5,000 1,650 750 1,400 585 $11,615 $6,515 Total Per unit Sales 37500 195 Blake is evaluating two options to increase the number of mascots sold next month. First, he believes he can increase sales by advertising in the university newspaper. Blake can purchase a package of 12 ads over the next month for a total of $1,500. He believes the ads will increase the number of stuffed mascots sold from 1,500 to 2,200. A second option would be to reduce the selling price. Blake believes a 15% decrease in the price will result in 2,400 mascots sold. Calculate the operating income for each options? Operating Income Option 1 $ 6075 Option 2 $ 4097 Which plan should Blake implement? Option 1 At what level of sales would he be indifferent between the two plans? believes the ads will increase the number of stuffed mascots sold from 1,500 to 2,200. A second option would be to re selling price. Blake believes a 15% decrease in the price will result in 2,400 mascots sold. Calculate the operating income for each options? Operating Income Option 1 $ 6075 Option 2 $ 4097 Which plan should Blake implement? Option 1 At what level of sales would he be indifferent between the two plans? mascots