Case 1 – Cost-Volume-Profit Analysis (Assignment 1 – 20% offinal grade) Janet Jennings is the general manager for MercashoeStore. She is currently working on a major promotional campaign.Her ideas include the installation of a new lighting system andincreased display space that will add $24,000 in fixed costs to theexisting fixed costs. In addition, Janet is proposing a 5% pricedecrease ($40 to $38) that will produce a 20% increase in salesvolume (20,000 to 24,000). Variable costs will remain at $24 perpair of shoes. Management is impressed with Janet’s ideas butconcerned about the effects theses changes will have on thebreak-even point and the margin of safety. Information provided: A.Rental expenses for the store: $5,000 per month. B. Janet has asalary assigned of $60,000 per year. C. The store has a salesmanager who earns $45,000 per year. D. There are three salesclerkswho have a salary assigned of $25,000 each per year. E. Socialsecurity expenses for each the employees represent 30% of theirsalary. F. Utilities expense: $600 per month. Instructions: 1.Compute the current break-even point in units and compare it to thebreak-even point in units if Janet’s ideas are implemented. 2.Compute the contribution margin ratio under current operations andafter Janet’s changes are introduced. (Round to the nearest fullpercent). 3. Compute the margin of safety under the two proposals.4. What is the operating income under each scenario? 5. Prepare aCVP (Cost-Volume-Profit) income statement for current operationsand after Janet’s changes are introduced. 6. Prepare aCost-Volume-Profit graph under the two scenarios. 7. Prepare areport explaining and justifying whether Janet’s changes should beadopted or not and provide suggestions supported by the informationprovided above. Show your work in Word of Excel