1. Assume that a company is budgeting to sell 4,600 units of a product at a selling price per unit of $35. The variable cost per unit is $28 and total fixed costs are $7,000. REQUIRED Prepare a contribution margin income statement and calculate operating leverage. 2. Suppose the company is unsure exactly how many units they will sell. As such, their marketing department has provided a worst case scenario where sales would be 3,500 units and a best case scenario where sales would be 4,900 units. Assume that the selling price per unit, variable cost per unit and fixed costs will remain constant (per part 1). REQUIRED Prepare a contribution margin income statement and calculate operating leverage for both the worst case scenario (sales of 3,500 units) and the best case scenario (sales of 4,900 units). 3. Suppose the company believes that 4,600 units is the most likely volume of sales. However, it is unsure at what selling price per unit it will be able to charge. The marketing department has provided a high estimate of $45 per unit and a low estimate of $30 per unit. Assume that variable costs per unit and fixed costs will remain constant (per part 1). REQUIRED Prepare a contribution margin income statement and calculate operating leverage for both the high ($45 per unit) and low ($30 per unit) estimate of the selling price. 4. Suppose the company believes that 4,600 units is the most likely volume of sales and that $35 is the most likely selling price per unit. However, the production department is unsure as to the exact variable cost per unit. The production department has provided a high cost per unit of $29 and a low cost per unit of $19. Assume that fixed costs will remain constant (per part 1). REQUIRED Prepare a contribution margin income statement and calculate operating leverage for both the high variable cost per unit ($29) and the low cost per unit ($19). 5. Suppose the company believes that 4,600 units is the most likely volume of sales, that $35 is the most likely selling price per unit, and that $28 is the most likely variable cost per unit. However, the accounting department is unsure as to the exact value of fixed costs. They have provided a high estimate of fixed costs to be $8,500 and a low estimate of fixed costs to be $5,500. REQUIRED Prepare a contribution margin income statement and calculate operating leverage for both the high estimate of fixed costs ($8,500) and for the low estimate of fixed costs ($5,500).