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  3. 3. lazy days inc. (ldi), sells hammocks. revenue a

3. Lazy Days Inc. (LDI), sells hammocks. Revenue and cost information is given below: Sales...

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Accounting

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3. Lazy Days Inc. (LDI), sells hammocks. Revenue and cost information is given below: Sales Price TL 30 Unit Variable Cost 20 Annual Fixed Operating Expenses 47,500 Required: (15 points) a) Determine the sales volume in units and TL amount that would be required to attain a TL 12,500 profit. Verify your answer by preparing an income statement using the contribution margin format. b) LDI is considering the implementation of a quality improvement program. The program will require a TL 2.50 increase in the variable cost per unit. To inform its customers of the quality improvements, the company plans to spend an additional TL 5.000 for advertising. Assuming that the improvement program will increase sales to a level that is 1,500 units above the amount computed in requirement a, should LDI proceed with plans to improve product quality? Support your answer by preparing a budgeted income statement c) Determine the new break-even point volume of units and sales in TL as well as the margin of safety percentage, assuming that the quality improvement program is initiated

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