The Fashion Shoe Company operates a chain of women's shoe shops that carry many styles of shoes that are all sold atthe same price. Sales personnel in the shops are paid a sales commission on each pair of shoes sold plus a small basesalary.The following data pertains to Shop 48 and is typical of the company's many outlets:Selling priceVariable expenses:Invoice costSales commissionTotal variable expensesPer Pair ofShoes$ 40.00$ 16.004.00$ 20.00Fixed expenses:AdvertisingRentSalariesAnnual$ 45,00031,000155,000Total fixed expenses$ 231,000Required:1. What is Shop 48's annual break-even point in unit sales and dollar sales?Note: Do not round intermediate calculations.Break-even point in unit salespairs

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Answered: The Fashion Shoe Company operates a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The Fashion Shoe Company operates a chain of women's 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 company's many outlets: Per Pair of Shoes Selling price 2$ 25.00 Variable expenses: Invoice cost 2$ 11.50 Sales commission 3.50 Total variable expenses 2$ 15.00 Annual Fixed expenses: Advertising $ 44,000 Rent 34,000 170,000 Total fixed expenses $ 248,000 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 27,100 pairs of shoes are sold? (Do not round intermediate calculations.) Net operating income Net operating loss
The Fashion Shoe Company operates a chain of women's 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 company's many outlets: Per Pair of Shoes Selling price 2$ 25.00 Variable expenses: Invoice cost $ 11.50 Sales commission 3.50 Total variable expenses 2$ 15.00 Annual Fixed expenses: Advertising 2$ 44,000 34,000 170,000 Rent Salaries Total fixed expenses $ 248,000 Required: 1. What is Shop 48's annual break-even point in unit sales and dollar sales? (Do not round intermediate calculations.) Break-even point in unit sales pairs Break-even point in dollar sales
The Fashion Shoe Company operates a chain of women's 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 company's many outlets: Per Pair of Shoes Selling price $ 25.00 Variable expenses: Invoice cost $ 11.50 Sales commission 3.50 Total variable expenses 15.00 Annual Fixed expenses: Advertising $ 44,000 34,000 170,000 Rent Salaries Total fixed expenses $ 248,000 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? (Do not round intermediate calculations. Round your final answers to the nearest whole number.) New break-even point in unit sales pairs New break-even point in dollar sales
The Fashion Shoe Company operates a chain of women’s 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 company’s many outlets: Per Pair of Shoes Selling price $ 25.00 Variable expenses: Invoice cost $ 11.50 Sales commission 3.50 Total variable expenses $ 15.00 Annual Fixed expenses: Advertising $ 32,000 Rent 17,000 Salaries 110,000 Total fixed expenses $ 159,000 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? (Do not round intermediate calculations. Round "New break-even point in unit sales" up to the nearest whole unit and…
The Fashion Shoe Company operates a chain of women’s 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 company’s many outlets: Per Pair of Shoes Selling price $ 25.00 Variable expenses: Invoice cost $ 11.50 Sales commission 3.50 Total variable expenses $ 15.00 Annual Fixed expenses: Advertising $ 32,000 Rent 17,000 Salaries 110,000 Total fixed expenses $ 159,000 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 18,600 pairs of shoes are sold? (Do not round intermediate calculations.)
The Fashion Shoe Company operates a chain of women's 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 company's many outlets: Per Pair of Shoes $ 20.00 Selling price Variable expenses: Invoice cost Sales commission Total variable expenses Fixed expenses: Advertising Rent Salaries Total fixed expenses $ 5.00 5.00 $ 10.00 Net operating income Annual $ 36,000 25,000 125,000 $ 186,000 Required: 5. Refer to the original data. As an alternative to (4) above, the company is considering paying the Shop 48 store manager 45 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 21,600 pairs of shoes are sold? Note: Do not round intermediate calculations.
The Fashion Shoe Company operates a chain of women's 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 company's many outlets: Per Pair of Shoes $ 40.00 Selling price Variable expenses: Invoice cost Sales commission Total variable expenses Fixed expenses: Advertising Rent Salaries Total fixed expenses $ 16.00 4.00 $ 20.00 Annual $ 45,000 31,000 155,000 $ 231,000 Required: 5. Refer to the original data. As an alternative to (4) above, the company is considering paying the Shop 48 store manager 55 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 13,550 pairs of shoes are sold? Note: Do not round intermediate calculations.
Required information [The following information applies to the questions displayed below.] The Fashion Shoe Company operates a chain of women's 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 company's many outlets: Per Pair of Shoes $ 20.00 Selling price Variable expenses: Invoice cost Sales commission Total variable expenses Fixed expenses: Advertising Rent Salaries Total fixed expenses $ 6.50 5.50 $ 12.00 Annual $ 42,000 32,000 160,000 $ 234,000 5. Refer to the original data. As an alternative to (4) above, the company is considering paying the Shop 48 store manager 55 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 31,350 pairs of shoes are sold? (Do not round intermediate…
Required information [The following information applies to the questions displayed below.] The Fashion Shoe Company operates a chain of women's 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 company's many outlets: Per Pair of Shoes $ 20.00 Selling price Variable expenses: Invoice cost Sales commission Total variable expenses Fixed expenses: Advertising Rent Salaries. Total fixed expenses $ 6.50 5.50 $12.00 Annual New break-even point in unit sales New break-even point in dollar sales $ 42,000 32,000 160,000 $ 234,000 4. The company is considering paying the Shop 48 store manager an incentive commission of 80 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? (Do not round…
The following information applies to the questions displayed below.] The Fashion Shoe Company operates a chain of women’s 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 company’s many outlets: Per Pair of Shoes Selling price $ 25.00 Variable expenses: Invoice cost $ 11.50 Sales commission 3.50 Total variable expenses $ 15.00 Annual Fixed expenses: Advertising $ 32,000 Rent 17,000 Salaries 110,000 Total fixed expenses $ 159,000 6. Refer to the original data. The company is considering eliminating sales commissions entirely in its shops and increasing fixed salaries by $35,400 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.)
: The Fashion Shoe Company operates a chain of women’s shoe shops that carry many styles ofshoes 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 asmall base salary.The following data pertains to Shop 48 and is typical of the company’s many outlets:Per Pair ofShoesSelling Price $30Variable Expenses:Invoice Cost 13.50Sales Commission 4.50---------Total Variable Expenses $ 18.00AnnualFixed Expenses:Advertising $ 30,000Rent 20,000Salaries 100,000---------------Total Fixed Expenses $ 150,000Required:a. What is Shop 48’s annual break-even point in unit sales and dollar sales?b. Prepare a CVP graph showing cost and revenue data for Shop 48 from zero shoes up to 17,000pairs of shoes sold each year. Clearly indicate the break-even point on the graph.c. If 12,000 pairs of shoes are sold in a year, what would be Shop 48’s net operating income(loss)?d. If this year’s sales increase by $75,000 and fixed expenses do not…
[The following information applies to the questions displayed below.] The Fashion Shoe Company operates a chain of women’s 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 company’s many outlets: Per Pair of Shoes Selling price $ 25.00 Variable expenses: Invoice cost $ 11.50 Sales commission 3.50 Total variable expenses $ 15.00 Annual Fixed expenses: Advertising $ 32,000 Rent 17,000 Salaries 110,000 Total fixed expenses $ 159,000 Required: 1. What is Shop 48's annual break-even point in unit sales and dollar sales? (Do not round intermediate calculations.) Break-even point in unit sales pairs Break-even point in dollar sales

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