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1. (8 points) Key Corporation produces and sells a single product. The company's contribution format income statement for July appears below: Sales (5,500 units) Variable
1. (8 points) Key Corporation produces and sells a single product. The company's contribution format income statement for July appears below: Sales (5,500 units) Variable expenses Contribution margin Fixed expenses Net operating income 357,500 236,500 121,000 102,200 18,800 The company has no beginning or ending inventories. Required: a. What is the company's contribution margin ratio? b. What is the company's break-even in units? c. If sales increase by 100 units, by how much should net operating income increase? d. How many units would the company have to sell to attain target profits of $25,000? e. What is the company's margin of safety in dollars? f. When the company produces 5,500 units what is the company's degree of operating leverage
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