1 (25 marks) LABMASK Inc. manufactures washable masks which sell for $45 each. At present, the mask is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totalling $27 per mask, of which 60% is direct labor cost. Last year, the company sold 30,000 of these masks, with the following results: Sales (30,000 masks) Variable expenses Contribution margin Fixed expenses Net operating income Required: $1,350,000 810,000 540,000 450,000 $ 90,000 (Round your computation to one decimal place, where applicable) (a) What is the product's contribution margin (CM) ratio? Use the CM ratio to determine the breakeven point in dollar sales. (2 marks) (b) What is the contribution margin per unit? Use the CM per unit to determine the breakeven point in masks. (2 marks) (c) Compute the margin of safety and the degree of operating leverage at last year's sales level. (2 marks)