ACC 255 BBAs3 problem (chapter 2 & 3) Hung Van owns the College Barber Shop. He employs five barbers and pays cach a base rate of $1,200 per month. One of the barbers serves as the manager and receives an extra $600 per month. In addition to the base rate, each barber also receives a com- mission of $3.50 per haircut. Other costs are as follows. Advertising $200 per month $1,000 per month $0.30 per haircut $175 per month plus $0.20 per haircut $25 per month Barber supplies Utilities Magazinc:s Hung unly charges $12 per haircut a) Determine the: 1. Variable cost per haircut 2. Total monthly fixed costs b) Prepare an income statement (contribution format) for next month and assume 1,500 haircuts will be done. (Hint: Total monthly fixed cost $8,000) c) Calculate the breakeven point in units& $for barber shop. d) Prove that your answer in c) is correct by redoing an income statement like b) e) What type of cost structure does the barber shop have (see b)) and how does this affect profits? f) The shop is considering reducing the price of a haircut by $1 and increase advertising by $500/month. They think this will increase the haircuts cut by 300 haircuts/month. Analyze and determine if they should do the what if