a. Determine the annual break-even dollar sales volume.

b. Determine the current margin of safety in dollars.

c. Prepare a cost-volume-profit graph for the guitar shop. Label both axes in dollars with maximum

values of $1,000,000. Draw a vertical line on the graph for the current ($800,000) sales level, and

label total variable costs, total fixed costs, and total profits at $800,000 sales.

d. What is the annual break-even dollar sales volume if management makes a decision that increases

fixed costs by $50,000?