Sandhill Willis is the advertising manager for Bargain Shoe Store. She is currently working on a major promotional campaign. Her ideas include the installation of a new lighting system and increased display space that will add $ 22,000 in fixed costs to the 286,000 currently spent. In addition, Sandhill is proposing that a 5% price decrease ($ 40 to $38) will produce a 20% increase in sales volume ( 20,000 to 24,000). Variable costs will remain at $ 24 per pair of shoes. Management is impressed with Sandhill's ideas but concerned about the effects that these changes will have on the break-even point and the margin of safety. (a) Your answer is correct. Compute the current break-even point in units, and compare it to the break-even point in units if Sandhill's ideas are used. Current break-even point 17875 pairs of shoes New break-even point 22000 pairs of shoes e Textbook and Media (b) Your answer is correct. Compute the margin of safety ratio for current operations and after Sandhill's changes are introduced (Round answers to decimal places, eg. 15%) Current margin of safety ratio 11 % New margin of safety ratio 8 % e Textbook and Media Attempts: 1 of 5 used Prepare a CVP income statement for current operations and after Sandhill's changes are introduced. BARGAIN SHOE STORE CVP Income Statement Current New Selling Expenses $ $ Variable Expenses JUNE M Net Income/(Loss) $ Would you make the changes suggested