Requirements:

$1)$ Using the information in Perform Active$$s income statement above $($Exhibit $2)$ as a starting

point, calculate the following amounts:

a$.$ What is Perform Active$$s breakeven point in units and dollars before any of the above

changes take place $($i$.$e$.$ given the sale price and cost structure indicated in Exhibit $2)?$

b$.$ What was Perform Active$$s margin of safety in units and dollars in the year ending January

$31,2024?$ Calculate the margin of safety in percentage?

c$.$ How much would net operating income decrease if Perform Active did nothing to recover

the increase in cost of goods sold, and if all other costs and the selling price remain the

same?

d$.$ How many units would Perform Active need to sell to make the same amount of net

operating income as in the year ended January $31,2024,$ if it did nothing to recover the

increase in cost of goods sold, and if all other costs and the selling price remain the same?

e$.$ Determine the expected operating income under each proposed marketing plan.