Prepare a CVP income statement for current operations and after Sheridans changes are introduced.

Sheridan 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 $30,400 in fixed costs to the $272,000 currently spent. In addition, Sheridan is proposing that a 5% price decrease ($40 to $38) will produce a 20% increase in sales volume (20,000 to 24,000). Variable costs will remain at $24 per pair of shoes, Management is impressed with Sheridan'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 Sheridan's ideas are used. Current break.even point 17000 pairs of shoes New break even point 21000 pairs of shoes e Textbook and Media Assistance Used Attempts: 2 of 3 used (b) Your Answer Correct Answer Your answer is correct Compute the margin of safety ratio for current operations and after Sheridan's changes are introduced (Round answers to o decimal places, es. 15%.) Current margin of safety ratio 15 % New margin of safety ratio 10 % e Textbook and Media Solution Attempts: 3 of 3 used c) Your answer is partially correct Prepare a CVPincome statement for current operations and after Sheridan's chances are introduced. BARGAIN SHOE STORE CVP Income Statement Prepare a CVP income statement for current operations and after Sheridan's changes are introduced, BARGAIN SHOE STORE CVP Income Statement Current New $ Sales $ 8.00.000 9.12.000 5.76,000 Variable Expenses 4,80,000 Contribution Margin 3.20,000 3.36.000 2,72,000 3.02.400 Fixed Expenses 40.000 $ 3.3000 Net Income/ikoni Would you make the changes suggested? No Assistance Used eTextbook and Media Textbook Video Attempts of used Submit Answer Save for Later