Required information Problem 6-26 (Algo) CVP Applications; Break-Even Analysis; Graphing [LO6-1, LO6-2, LO6-4, LO6-5] Skip to question [The following information applies to the questions displayed below.]

The Fashion Shoe Company operates a chain of womens shoe shops that carry many styles of shoes that are all sold at the same price. Sales personnel in the shops are paid a sales commission on each pair of shoes sold plus a small base salary.

The following data pertains to Shop 48 and is typical of the companys many outlets:

Per Pair of Shoes

Selling price $ 30.00

Variable expenses:

Invoice cost $ 11.00

Sales commission 4.00

Total variable expenses $ 15.00

Annual

Fixed expenses:

Advertising $ 33,000

Rent $23,000

Salaries $115,000

Total fixed expenses $ 171,000

Problem 6-26 (Algo) Part 5 5. Refer to the original data. As an alternative to (4) above, the company is considering paying the Shop 48 store manager 50 cents commission on each pair of shoes sold in excess of the break-even point. If this change is made, what will be Shop 48's net operating income (loss) if 14,200 pairs of shoes are sold? (Do not round intermediate calculations.)

Net Operating Income

6. Refer to the original data. The company is considering eliminating sales commissions entirely in its shops and increasing fixed salaries by $32,300 annually. If this change is made, what will be Shop 48's new break-even point in unit sales and dollar sales? (Do not round intermediate calculations.) New Break-even point in unit sales

New break even point in dollar sales