Formal Sesting Company is crying 3.000 vernized bean bag chains a month at a price of $74 per chair. The variable cost of each chairsold includes $45 to purchase the bean bag chairs from suppliers and a 5 sales commission and costs $11.000 per month The company is considering making several operational charges and wants to know how the change will not to income Requirement. The company's cuest contribution in income tant (Use paths or mission for an operating :) Fong Company Contribution Margin income Statement Cost of goodud i Requirements 1. Prepare the company's current contribution margin income statement. 2. Calculate the change in operating income that would result from implementing each of the following independent strategy alternatives. Compare each alternative to the current operating income as you calculated in Requirement 1. Consider each alternative separately. a. Alternative 1: The company believes volume will increase by 12% if salespeople are paid a commission of 5% of the sales price rather than the current $9 per unit. b. Alternative 2: The company believes that spending an additional $7,000 on advertising would increase sales volume by 15%. c. Alternative 3: The company is considering raising the selling price to $94, but believes volume would drop by 14% as a result. d. Alternative 4: The company would like to source the product from domestic suppliers who charge $8 more for each unit. Management believes that the "Made in the USA" label would increase sales volume by 12% and would allow the company to increase the sales price by $14 per unit. In addition, the company would have to spend an additional $7,000 in marketing costs to get the word out to potential customers of this change. Print Done