Question - Bonita Beauty corporation manufacture: cosmetic products that aresolo through a network of sales agena The agents are paid a commission of 20% ofsales, The income statement For the year ending December 31, 2017, is as Follows.
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BONITA IEIUTI' CORPORATION Income statement For the Year Ended Number 31, 2017
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Sales
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$77,300,000
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Cost of goods sold
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Variable
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$37,877,000
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Fixed
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8,760,000
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46,637,000
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Gross margin
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$30,663,000
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Selling and marketing expenses
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Comissions
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$15,460,000
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Fixed costs
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10,000,000
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25,460,000
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Operating income
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$5,203,000
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The company is considenng hiring its own sales staff to replace the network Magenta Itwill pay its salapeople a commission of 10% and incur additional ?xes costs of $7,730,000.
(a) Under the current policy of using a network of sales agents, calculate the Bonita Beauty Corporation's weak-even point in sales dollars for the year 2017.