Skip to question [The following information applies to the questions displayed below.] The Fashion Shoe Company operates a chain of women's shoe shops carrying many styles of shoes all sold for $25 per pair. 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 company's many outlets: Per Pair of Shoes $ 25.00 Selling price Variable expenses: Invoice cost Sales commission $11.50 3.50 Total variable expenses $15.00 Annual Fixed expenses: Advertising Rent $ 44,000 34,000 Salaries 170,000 Total fixed expenses $248,000 Required:

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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[The following information applies to the questions displayed below.]
The Fashion Shoe Company operates a chain of women's shoe shops carrying many styles of shoes all sold for $25 per pair. 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 company's many outlets:
Per Pair of Shoes
$ 25.00
Selling price
Variable expenses:
Invoice cost
Sales commission
Fixed expenses:
Advertising
Total variable expenses $15.00
Annual
Rent
$11.50
Salaries
3.50
$ 44,000
34,000
170,000
Total fixed expenses $248,000
Required:
4. The company is considering paying the Shop 48 store manager an incentive commission of 75 cents per pair of shoes (in addition to
the salesperson's commission). If this change is made, what will be the new break-even point in unit sales and dollar sales?
Note: Do not round intermediate calculations. Round "New break-even point in unit sales" up to the nearest whole unit and round
"New break-even point in dollar sales" to the nearest whole dollar.
Transcribed Image Text:Skip to question [The following information applies to the questions displayed below.] The Fashion Shoe Company operates a chain of women's shoe shops carrying many styles of shoes all sold for $25 per pair. 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 company's many outlets: Per Pair of Shoes $ 25.00 Selling price Variable expenses: Invoice cost Sales commission Fixed expenses: Advertising Total variable expenses $15.00 Annual Rent $11.50 Salaries 3.50 $ 44,000 34,000 170,000 Total fixed expenses $248,000 Required: 4. The company is considering paying the Shop 48 store manager an incentive commission of 75 cents per pair of shoes (in addition to the salesperson's commission). If this change is made, what will be the new break-even point in unit sales and dollar sales? Note: Do not round intermediate calculations. Round "New break-even point in unit sales" up to the nearest whole unit and round "New break-even point in dollar sales" to the nearest whole dollar.
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