The Fashion Shoe Company operates a women's shoe shop that carries many styles of shoes that are sold at the same price. Sales personnel in the shop are paid a substantial commission on each pair of shoes sold in addition to a small base salary) in order to encourage them to be aggressive in their sales office. Revenue and cost data for the shop are as follows: Per pair of shoes Selling price $30.00 Variable costs: Invoice cost 13.50 Sales commission 4.50 Total variable costs $18.00 Annual Fixed costs: Advertising $30,000 Rent 20,000 Salaries 100,000 Total Fixed Costs $150,000 1. Calculate the break-even point in units (pair of shoes) 2. Calculate the break-even point in sales dollars. 3. Prepare an income statement using the contribution format. Assume that 12,000 pairs of shoes were sold. 4. The owner wants a profit (operating income) of $75,000. How many pairs of shoes must be sold to achieve the desired profit? 5. Calculate the dollar sales required to generate a profit of $75,000. 6. The owner is considering hiring two additional employees and extending hours of operation. The new employees would be paid a salary of $15,000 each plus the commission given to other employees. By doing so, the owner hopes to double sales volume. If the owner hires the additional employees, how many pairs of shoes must be sold to achieve the desired profit of $75,000? 7. Assume the owner hires the additional employees and estimates sales based on your calculation in 6. Determine the margin of safety in dollars and the margin of safety percentage