04.(12 Marks) The following monthly budgeted data are available for the Data Management Company: Product C Sales $500,000 Variable expenses 300.000 Contribution margin $200,000 Product J $300,000 210,000 $90,000 Product R $900.000 720,000 $180,000 Budgeted operating income for the month is $220,000. Required: a) Calculate the break-even sales for the month. (8 Marks) b) Calculate the margin of safety. (2 Marks) c) Calculate the degree of operating leverage. (2 Marks) Q3. (8 Marks) Timeliner Company's most recent contribution format income statement is presented below: Sales Less: Variable Expenses Contribution Margin Less: Fixed Expenses Operating Loss $75.000 $45.000 $30,000 $36.000 $16.000 The company sells its only product for $15 per unit. There were no beginning or ending inventories. Required: a) Compute the company's break-even point in units sold. (2 Marks) b) Compute the total variable expenses at the break-even point. (2 Marks) c) How many units would have to be sold to earn a target operating income of $9,000? (2 Marks) d) The sales manager is convinced that a $6,000 increase in the advertising budget would increase total sales by $25,000. Would you advise the increased advertising outlay? (2 Marks)